The Ultimate Exit Strategy: 4 Reasons To Execute Your Will Today
In the weeks immediately following the death of Robin Williams, his family seemed unified in grief. That illusion was shattered recently when court documents revealed the infighting over his wealth, memorabilia, and even clothing, had resulted in Mrs. Williams banning her husband’s grown children from her home. Mr. Williams’s estate planning documents did not provide enough clarity to determine what his wife and children were entitled to receive. Tempers flared and the situation quickly devolved into a contentious court case.
With methodical planning, honest conversations, and appropriate legal documents in place, this situation might have been avoided. But many Americans don’t take the time to do estate planning, much less get specific about how affairs should be handled once someone has passed away. Why?
Perceived cost, procrastination, and uncertainty
“Many people reject estate planning because they don’t like to think about death. I mean, who does? In addition, most people assume they can’t afford it anyway and I don’t blame them. Most lawyers charge sky high hourly rates,” says Jeff Bell, CEO of LegalShield, a network of dedicated law firms that members can call for help. A $20 monthly plan membership grants clients access to lawyers for answers to legal questions including assistance with deciphering contracts or executing a will. “Everyone deserves access to the knowledge a lawyer can offer without worrying about their ability to pay. In modern terms, we ‘crowd-share’ law firms in 49 states and 4 Canadian provinces, providing affordable legal access to 3.7 million people and counting. A standard will is a benefit of our plan.”
Mr. Bell believes the uncertainty most people feel about estate planning causes them to delay taking action. Procrastination, though, is conquered by the step-by-step guidance experienced lawyers can provide. Clients should rest easy knowing their best interests will be represented, he says, and they “need not feel pressured to become estate planning experts themselves.”
Wills versus trusts
Most middle income Americans benefit from a good standard will. Trusts are reserved for unique cases like families who wish to make provisions for a special needs child or for instances when the decedent’s assets include a business, extensive real estate or big ticket property items, or detailed instructions for trustees. The more complex the assets or numerous the heirs, the more likely a trust will better serve needs.
A qualified lawyer can guide this decision appropriately. It’s important to make a choice as soon as possible to keep the forward momentum going. Some people fail to follow through by signing the documents and getting witness signatures while others neglect to transfer assets (title) into their trust. Both lapses result in invalid will or trust documents, rendering them worthless under the law.
No will or trust? You just abdicated your wishes to the state
If you die without a will or trust in place, the state will step in to make decisions on your behalf. The common asset dispensation involves awarding assets to your surviving spouse or directly to your children if you are unmarried. If you have no spouse or children, the state will usually identify blood relatives and award them your assets eventually.
The “leave it to the state” arrangement features four inherent flaws. Ask yourself:
1. Am I open to temporary foster care for my minor children?
If parents fail to designate who should raise their children, the state will step in to make custody decisions. If no potential guardian is immediately apparent to the judge the children could be remanded to state custody (foster care) while the court investigates. A will or trust allows parents to transfer guardianship of minors to trusted friends or loved ones.
2. Am I fine with the state disregarding my oral or written instructions?
People who designate which heirs they intend to leave specific items from their estates should know that those documents are meaningless if written outside of the context of a formal will or trust.
“I had a client who meticulously labeled her items of personal property by taping pieces of paper to them and writing, ‘This goes to Mary, my hairdresser…’ or ‘This is for my husband’s long-time friend, George.’ She had 60 or 70 of these tags. Some of them just said, for example, “Rachael.” I appreciate what she was trying to do, but it doesn’t stand up in court. Her will had a specific way to handle her personal property, and none of these people were named. The right way to accomplish this is to use a “devise of tangible personal property” (or, in some states it would be called “a memorandum of personal belongings”) to bequeath non-cash personal property. This way she would have a legally binding detailed list of items and who should receive each one. If she were to get upset with Mary she could simply strike her name from that document without having to go to her attorney to formally change the will. And that is even easier than trying to unpeel the sweet but meritless sticky note,” says Charlie Davis, Managing Partner and Co-Founder of Davis Miles McGuire Gardner, PLLC, a LegalShield Provider.
3. Do I feel keen to pay an extra premium?
It can get expensive to relinquish decision-making to the state. While wills go through probate court, estates without a will generally take longer to administer. The costs associated with extra time spent in probate court will be deducted from assets, leaving less to dispense to heirs.
4. Does open-ended probate time sound good?
Clearing the estate from probate could take a long time, dragging out dispensation to heirs for years in some cases. It is cheaper and more expedient to draw up a will that expedites the probate process. Estates protected by wills and trusts typically fly through the probate process so long as no one challenges them.
Don’t be duped: online will and trust document services
“Some people do their own wills through document preparation services trying to save money. The people assembling these documents deliver them without offering advice, discussing probate issues, and asking important follow-on questions. That can lead to unintended and sometimes disastrous consequences. One of our lawyers has a practice almost solely devoted to handling problems where wills and trusts are poorly drafted, ambiguous, or ill conceived. And he is very busy. Experienced will and trust lawyers ask the right questions and discuss the implications of your desires and decisions,” says Mr. Davis.
LegalShield’s Jeff Bell agrees that no one should waste time “economizing” with document preparation services. He stresses that LegalShield is a part of the sharing economy and that opportunities abound for plan members whether they are looking to write their wills or get help collecting unpaid bills for their small businesses.
“In this country, a lot of people worry that the color of justice and access to legal help is green. LegalShield is disrupting all of that. Legal access is no longer determined by a person’s wealth level. Every North American deserves the opportunity to leave a legacy for their families. The first step is protecting those families with a well thought-out last will and testament,” says Mr. Bell.
LegalShield members get consultation on unlimited personal legal matters with lawyers experienced in estate planning as well as many other topics. LegalShield currently affords 1.4 million families equal access to justice through the legal service plans it has offered for 40 years. LegalShield lawyers stand ready to provide legal advice and draw up wills without additional charge to members.