A will-making task is not just for wealthy and elderly people. The well-prepared can also benefit from a will.
The recent years are a stark reminder of the fact that we may not be able to predict our final days. According to data from the Centers for Disease Control and Prevention, the life expectancy of Americans dropped both in 2020 and in 2021. This was due to COVID-19-related deaths and an increased number of accidental deaths.
According to the CDC, over 1 million Americans have died from COVID-19. The organization also found that accidents and unintentional injury will be the leading cause of deaths in the U.S. in 2021.
You’re unlikely to die early. Even if you feel that you do not need a will, having one in place can help to prevent important decisions regarding your estate and guardianship being left to the state laws and court. You don’t need to spend thousands on a will.
If you do not have a Will, what can happen?
In the event that you die without a valid will (also known as “dying intestate”), your estate is distributed according to state laws on inheritance. Probate without a valid will is a more complex and lengthy process. Inheritors must make an application to claim the estate.
State intestacy laws differ, but close relatives, like spouses, children and parents, are usually the first to benefit. Regina Kiperman is the managing attorney of estate planning firm RK Law PC, in New York. She says that if you do not have a valid will, your funds could end up with unintended beneficiaries.
Even if you do not have children or a partner, dying intestate is still a bad thing. Your next-of-kin is likely to be your parent in this situation. Kiperman says that significant assets may disqualify older adults from Medicaid.
A will is equally important if you have children. A will allows you to choose a guardian for your children, regardless of whether or not there are assets that need to be passed down. State laws will determine who is responsible for caring for your children and what inheritance they receive.
Should you write a Will?
Kiperman explains that the right time to create a will depends on certain life events and not your age. These events can be divided into three main categories: the acquisition of assets (such a buying a home), legal attachment (such as getting married or having children) and death risk (such a health diagnosis or remote travel ).
It can be helpful in some situations to write a will when you reach the legal age, which is 18 years old for most states.
Mariel Picknelly is a 21-year-old singer/content creator from New York. “I wanted protect myself as soon as I could,” she says. She was encouraged by her mother to create a will when she became an adult to safeguard assets that were owed to her. Her own will gives her and her entire family peace of mind about their future.
She says, “I don’t keep my purse open because I do not want someone to steal the items that belong to me, my family or my future.” The same is true for a will.
It doesn’t need to take a lot of time or be expensive. You can download free templates from some websites. Make sure they meet the requirements of your state. You can create a will online for less than $100 using software.
A will can be drafted by an estate planning lawyer for those with complex family circumstances or assets. The cost of an estate planning attorney can vary from $200-$350 per hour or $1000 to $2000 for a flat rate package.
A will can be a great starting point but in certain cases, it is not enough. Setting up a trust could help you transfer assets more quickly and smoothly if you have large assets or a complex family situation. You can also avoid the lengthy probate process.
Kiperman says that, for example, “if you have volatile investments, like securities or other assets, you may want to use a trust rather than a will, so you can give someone immediate access to the assets.” If you want to protect assets for minors or lifelong relatives, trusts are a better option.
A will may not be the best estate planning tool, but that doesn’t make it any less valuable. A flawed plan is still better than no plan at all.
Picknelly: “Some people say having a Will is only for the rich.” It’s only for people who are careful. It’s not necessary to own a lot of money; all you need is protection when you can’t be there to defend yourself .”
The Associated Press originally published this article, which was written by NerdWallet.