Let's be honest; no one likes to talk about their last wishes when they pass away. Unfortunately, this is a conversation everyone should have with their family members to ensure their assets are transferred to their designated beneficiaries without any issues.
Several types of wills are available that work best for specific situations and others that may not fit your needs. To learn more about these different wills and how they can benefit you and your family, continue reading below. We will cover all you need to know about these different types of wills and who you can contact for more information.
Of all the different types of wills, this one is relatively straightforward. With a simple will, you can list who receives your assets and who will be the guardian over your children if you pass away prematurely.
With this type of will, you can declare:
- How do you want to give away your assets
- Who receives what kind of asset
- Who will be the listed executor of your estate
If you have a complicated estate where you own a business or your estate will be heavily taxed, you should opt for a different type of will.
Other situations where you should not use a simple will:
- You want to leave land to your children or another family member
- You have children from a previous marriage
- You need to set up a special needs trust
- You have reason to believe someone will challenge your will
When in doubt, you can reach out to a reputable estate planning attorney to help you figure out which types of wills work best for your situation.
Testamentary Trust Will
A testamentary will is a trust you place certain assets into for your benefit. A named trustee will handle the trust on your behalf when you pass away. This is an excellent option if you have beneficiaries that are minors or who are people you don't want to inherit and handle on their own.
This type of will allows you to place conditions on how your beneficiaries receive the assets. For example, you can put instructions to release a certain amount of money or a particular asset to become available when a child graduates college or when someone gets married.
A living will isn't an actual will; instead, it is a statement of your last wishes. This living will covers how you wish to be medically cared for and if the hospital can or cannot use any life-saving measures. For example, if you were to go into a vegetative state, would you want the staff to keep you alive via machines, or would you want them to take you off life support.
Having a living will in place takes the health-care decision burden off of your family. If you want to ensure that your medical-related wishes are honored, you should make sure to have a living will put in place.
Holographic wills aren't the sci-fi floating document you may be picturing right now. Instead, these wills are entirely written in your handwriting, and the witness and notary requirements that come with wills are less stringent than a holographic will.
The main issue with these types of wills is they are more ambiguous. This means it can cause problems with your beneficiaries as they may have different opinions regarding your final wishes. One beneficiary may think you mean one thing, whereas another can interpret your wishes as something else.
A husband and a wife typically create joint wills. For example, one spouse may agree to leave the entire estate to the other if one of them were to pass away before the other.
These wills were a bit more common back in the day because they saved a lot of time and money, but times have changed. The surviving spouse can't change a joint will without the other spouse's permission. So if you were to remarry, the assets in the joint will can't and won't transfer to your stepchild in your new relationship.
Oral wills are, as the name implies, a will spoken verbally to one or more witnesses. Most states don't recognize these types of wills because they aren't concrete and are hard to decipher correctly. Generally, they aren't acceptable unless the will is spoken while you're on your deathbed.
Will vs. Trust
Trusts and wills are both excellent tools used for estate planning, but one only works during a significant life event, whereas you can use the other while alive. Wills and trusts are both set up while you are alive, but wills only kick into effect when you pass away. A trust can be used during your life or go into effect when you pass away.
Different Types of Trusts
Just like there are several different types of wills available for you to use, there are other trusts that you can use. For example, you can use an irrevocable trust to protect your assets from creditors. With an irrevocable trust, you give up your ownership rights to assets when you transfer them. A trustee manages these types of trusts.
Special Needs Trust
As mentioned earlier, if you need a special needs trust, you won't be able to list your wishes in a simple will. If you are concerned about the financial need of a beneficiary with a disability, you can create a special needs trust.
These legal arrangements enable your beneficiaries to receive financial support from the trust without jeopardizing their state or federal public assistance program eligibility. You should contact a reputable estate planning attorney if you need a special needs trust. The last thing you need is for your loved one to lose access to supplemental security income or other federal benefits because the trust affects their income.
What Happens if You Die without a Will?
If you die without a will, the distribution of your assets and property must go through probate. The state handles this process. In general, the court must declare someone as the executor of your estate before they can handle sorting through your debts and assets.
In general, the court allows a portion of your estate to go to your surviving spouse, and they will divide the remaining assets amongst your children if you have any. The court does not take in any factors that may influence it to divide the assets unequally. For example, if you don't want one child to receive something, the court won't know that. They will treat all your heirs as equals.
So if you have specific assets that you wish to go to one particular person, you should create a will. This will lessen the burden that your family has to go through with probate court. Depending on the size of your estate, it could take months, if not years, for the probate process to complete.
How to Create a Will or a Trust
If you wish to create a will or a trust, you can do so without the need of an attorney, but that is not recommended. There are specific tax considerations and laws that you must keep in mind when creating these types of documents.
The last thing you want is to create a will online that does not have the proper protection or clear intentions. When you pass away, if the will is not direct on your last wishes, your beneficiaries are left to try to interpret your wishes.
Estate Planning Attorney
If you want to ensure your last wishes are honored and well understood, it would be best if you reached out to an attorney to create the document on your behalf. You may be tempted to pay the small fee online to file your paperwork, but if there are any discrepancies or mistakes made, it will cause problems down the road. Partnering with an estate planning attorney will ensure you have honored all your last wishes.
Help with Different Types of Wills
Making sure that your last wishes are honored is a big deal to your family, so it is best that you get a will that clearly states what you want to happen you pass away.
Whether you need help creating your living will or a simple will, reputable attorneys can help you navigate the different types of wills. If you are ready to create your will or you have questions about what option is best for you and your situation, contact us.