Drawing up a will might seem daunting, especially if you’re still young, but there’s nothing like the peace of mind that comes with knowing you’ve made things easy for your loved ones once you’re gone.
A well-written will can help your family avoid legal challenges and heartache, and that means you can focus on living life to the fullest, without fretting about the future. Wills are essential for people from all financial backgrounds, especially if you care about what happens to your assets after your passing.
To ensure you are covering all your bases, it’s important to know what a will can do for you, as well as what it can’t.
Determining allocation of (some) assets
A carefully constructed will allows you to determine where your assets go. Encompassing everything from cherished possessions to your life’s savings, a will can be a blueprint for where and how your assets are allocated.
Providing specific details about the desired recipients of your assets, from family members to close friends who are not related to you, can ensure your wishes are met regardless of state laws. Utilizing a worksheet or checklist for your will can help you easily inventory your assets and their designations.
Some assets and property, however, should be left out of your will, such as life insurance policies or retirement accounts. These accounts have provisions for naming beneficiaries and should be handled directly through each service provider.
Appointing guardianship
Knowing who will care for your children in the event of your death is essential. If you have minor children, or plan to, you know that you want to provide the best for them, and this means ensuring appropriate guardianship.
The designation of guardianship in your will has long-term implications, so it is critical to talk honestly with those you’re asking to become guardians to ensure they understand what they’re agreeing to take on. In addition, it’s important to consider the lifestyles, family situations, and assets of any potential guardians so that you feel confident your children will be raised in a supportive and accepting environment.
Creating an enduring legacy
Within the confines of legal mandates, a high-quality will can guarantee that your legacy lives on after you’ve passed. If you’re dedicated to a particular cause, such as cancer research or animal welfare, a will can reflect your passion by donating a portion of your assets to a favorite charity.
When leaving gifts to loved ones, however, avoid strict conditions (such as marital status or college attendance). Gift conditions are often illegal and can breed conflict.
Your legacy can also include beloved pets, but property cannot be left directly to an animal. Instead, you can use your will to appoint ownership of your pets (and even provide financial support) to a trusted friend or family member to make sure they are cared for well into the future.
Understanding a will’s limitations
While a will can provide clarity and security in estate planning, it’s equally important to understand its limitations. For example, separate your funeral arrangement instructions from your will, as loved ones will likely need to consult these well before they get to your will.
Preparing for your funeral can be challenging, but documenting your wishes in an easily accessible format can help ease your loved ones’ stress during a difficult time. Also understand that a will can’t necessarily help you avoid estate taxes or probate processes—these are issues to discuss with a financial advisor now to plan for all eventualities.
The bottom line
Drawing up a thorough last will and testament will require time and effort, but the long-term returns—confidence and control over the financial legacy you will leave behind—are priceless.
