Do You Have A Will?
Talking about death is never pleasant, and thinking about one’s own death is even more uncomfortable. I guess that could be why a quick informal survey around my office revealed that a lot of people have not yet considered estate planning. I was surprised to even find that some colleagues who own real estate or have children don’t have a will.
What happens if a person dies without a will (known as dying intestate)?
Generally, when a person dies without a last will, the state’s intestacy laws determine what happens to the deceased’s stuff (the estate). Depending on the particular state, the estate may be distributed to a spouse, children, parents or siblings. Survivors have to go through the probate court system to have the estate distributed and this process can take months, and even years if the estate is complex or there are complicated familial relationships.
There are countless horror story accounts of what some survivors have gone through when a loved one has passed away without a will: years of court proceedings to have the estate released, thousands of dollars spent on attorney and appraiser fees, stepchildren left out of the distribution, and sneaky relatives trying to claim a portion of the estate. One such story that I came across on the Huffington Post (My Story: Why People Need Wills), was about an estranged spouse who came out of the woodwork to make claim against the estate of his estranged wife. In the end, the estranged husband was able to get his hands on his deceased wife’s assets. The brother of the deceased woman, the author of the article, poignantly writes at the end, “People may think that wills and attorneys are expensive. In the overall scheme of things, they really aren’t. I gladly would have paid ten times the average cost for my mother and sister to have had wills.”
Good estate planning and an ironclad will or living trust can considerably speed up the estate distribution process and avoid a lot of the pitfalls that some survivors have had to navigate.
So when do you need to start estate planning?
At a healthy age 29, some would say it’s premature for me to consider my own death, but real talk — life is fragile. I’ve known otherwise healthy young people whose lives were unexpectedly claimed by freak accidents. It’s these types of stories that make me pause for a second and be thankful for the breath that fills my lungs, even on a sh-tty day. And then I also think about those who would be left behind to mourn me, and the unlucky ones who’d have to deal with my stuff: whose job would it be to pack up my things? who would be entitled to my stuff? would anyone know which banks hold my money and where my 401(k) sits?
I’m an organized person so the thought of leaving my loved ones to dig through my stuff after my death to try piece together bits of information about my bank accounts, insurance policies etc… almost seems like a cruel task to leave them with. This is one reason why estate planning — even for the single, relatively young and not so wealthy — is still important.
Estate planning is also more than just about what you own. Do you have a mortgage or student loans, and do you know what would happen to your debt upon your death? Do you have kids under 18, and have you thought about who would take on guardianship over your kids? These are all important questions considered part of the estate planning process. Other estate planning components include: a living will (also known as an advance directive), and establishing a power of attorney.
Estate planning sounds like a laborious task, but certainly one that is worthwhile. I have estate planning on my 2016 to-do list, do you?