The Reasons Why You Should Have a Will in Place and why it is important to have a will?
In a survey recently conducted by Gallup results revealed that while the Covid-19 drama is improving, less than half of people in the United States have a will. A “last will and testament” is a legal document that lets you determine what happens with your assets and how you can help your family after your death. As covid has shown, regrettably, the unexpected can happen.
If you care for your loved ones, your business and estate, or want to preserve your wealth, then you should have a will. Without one, if something unfortunate were to occur, important decisions will be made not by you, but by a local court and local laws. This can also make it more difficult for those you are concerned about. Those with minimal assets should also consider a will. For example, a court can direct any debts you may have in directions you may not want.
If the estate is more substantial and complex, a will is even more important, as planning can contribute substantially to conserving your wealth and reducing inheritance tax.
Here are some considerations as to why having a will and estate planning matter.
First, it will make things easier for your family and friends. Most estates in any jurisdiction must go through some court or similar process for legal recognition and to oversee the distribution of assets, often called probate or a probate court. If a person dies intestate, that is without a will, the court must appoint an administrator of the estate. This process is typically more complicated, costly, and potentially more time-consuming. With a will, you can choose who will administer it and the process is usually less complicated and more efficient. Therefore, with a will, you can save time, cost, and hassle.
(Please note: the table is a summary only. For more details, please talk to a trusted legal professional.)
“Who gets what?” is one of the critical questions. The testator, the person making the will, can direct that particular people get specific bequests (making them beneficiaries). They can also name the beneficiaries of “residuary assets” – anything that is not listed. Further, a last will and testament can limit or prevent people from gaining certain assets. For example, if you feel one child benefited more during your life, this can be readdressed in your will.
In today’s world, most people often have unappreciated digital assets, for instance, your social media and email accounts, files, and resources (photos, videos, domain names). A will allows you to name a specific person to manage and distribute this property.
For a parent of a dependent child or children, a will is particularly crucial, as it allows you to determine their guardian. This is acutely true if both parents pass in an accident or similar event. If you do not nominate a guardian, who will be responsible for the children’s day to day welfare, the court will do so, and you may not like their selection. In a will, you can also ensure that someone appropriate will take care of your pets, with adequate financial support if needed, as animals are deemed by the law in certain countries to be property.
Most people want to maximize the wealth that comes to their nearest and dearest. Advance planning to anticipate issues, preserve capital and reduce inheritance tax can make a great difference. It should be a consideration for anyone with significant wealth.
An additional factor for many people is a desire to leave money or other possessions to charities or causes they support. Without specification in a will, only family members can inherit your wealth or possessions; friends, charities, or other beneficiaries will get nothing. You may also want to leave instructions for your funeral or delegate what will happen to your body, such as organ donation.
A will gives clarity to your wishes and limits disputes among families and friends. Lastly, having a will give you peace of mind for the future. You have done what you can to protect your loved ones and friends.
As Bastien Trelcat, Managing Partner at Harvey Law Group (HLG) points out, “Ultimately, a will allows forward estate planning which can be immeasurably helpful for those you leave behind. As well, the world is becoming increasingly complicated. There are new asset classes; travel and living overseas are becoming widespread and having assets in several countries is more common. This adds to the complexity and really does mean more people need a will. Given the potential issues, I would suggest getting legal advice on your individual needs.”
HLG is dedicated to providing comprehensive, highly personalised advice on wealth preservation, family legacies, estate and tax planning. Unlike agents or non-authorised firms, HLG is a law firm, and as such, has an obligation to advise you on the best options for your goals.