Why Do You Need a Will?

A will is a document that tells the world what you want done with you and your stuff after your death. If you die without a will, it is going to be up to the state through a probate proceeding to decide who gets your stuff without regard to your wishes or the needs of your relatives. Also, if you die without a will, it is much more expensive for your relatives and they will get much less of your stuff i.e. the money after your stuff is sold because the cost of probate is expensive!

If you are an adult without any real property, a simple will is probably all you need. It doesn’t have to be anything fancy, but it should make clear your wishes for you and your stuff and meet the legal requirements for a will. If you are an adult with minor children, it is really important for you to have a will because a will is the best way to transfer guardianship of minors.

If you have real property, you will probably need a will and trust. A trust is a legal document that lets you decide how specific assets will be distributed after your death and lets you minimize gift/estate taxes and avoids probate costs which can be easily between 4-6% of the gross fair market value of estate. What this means is that a house which has a fair market value of $1 Million dollars can cost between $40,000-$60,000 to probate whereas if the same property was in a trust, there would be no cost to the beneficiaries except trust administration which is significantly less than probate. A will is still necessary because most trusts only deal with specific property and not the total of your assets. The will done with a trust is usually what is called a “pour over will.” The pour over will in addition to doing normal things of a will including naming the guardian of children, a pour over will puts all assets you intended to be put into the trust there even when the assets are omitted, there are new assets or the assets were not titled into the name of the trust.

The most common assets which are not part of a will or trust are life insurance policies and IRA/401k/Pension accounts which will be transferred automatically to the named beneficiaries upon death. Therefore, it is VERY important that you check your beneficiary statements on life insurance and IRA/401k/Pension accounts from time to time to make sure they are correct.

There is a common belief that getting a will or trust done is very expensive. This is simply not true for the vast majority of people. For the vast majority of people, a simple will or a will & trust will be all that is necessary together with health care and power of attorney documents.  Most attorneys allow you to pay overtime and will do changes to a will or trust on an hourly basis. In addition, most attorneys will review an existing will to make sure it conforms to current law.

If you do not have a will or will/trust, you should make it a priority. I see people for a free 30 minute consultation in Walnut Creek and Brentwood to discuss what type of estate planning is needed for your particular situation. An estate plan does not need to be difficult or costly.

This article provides only general legal information, and not specific legal advice. Information contained is not a substitute for a personal consultation with an attorney.  LAW OFFICE OF JOAN M. GRIMES, PHONE (925) 939-1680 1600 S. Main Street, Suite 100, Walnut Creek, CA 94513  © 2015 Joan Grimes