Don’t leave your loved ones without a will

Failing to make a will, or to review an existing will, can distort or destroy your best intentions.

That may seem obvious but, according to USA Today, 41 percent of aging Baby Boomers do not have a will, and 71 percent of adults under age 34 don’t have one. The reasons they give: they don’t have enough assets, the cost of preparing a will is too expensive or they’re just plain procrastinating.

But what happens if you die intestate – without a will? A state court chooses an administrator, usually your surviving spouse. Sometimes that’s okay. But what if you have children from two marriages? Do you want your last spouse making all the decisions?

And what if your spouse dies first? Some states give children equal say in administering the estate, which can lead to discord. If no qualified and competent relative is available, some states turn administration over to a public agency.

While state law provides for transfer of your assets to certain relatives, your special friends or favorite charities will be left out. And if none of those relatives survive you, the state gets everything.

Finally, what if only a minor child survives you? A court will appoint a legal guardian, and you’ll have no say in who takes care of your child – or how.

Hopefully, you’re convinced to write a will, so let’s walk through some important points.

Put It in Writing

Witnessed wills are valid in all 50 states. Some states accept handwritten, or holographic, wills, but you need to be careful. Any typing or preprinted language may render a holographic will invalid. Use an experienced attorney if you want to be sure that you have a valid will.

Consult Family and Friends

Parents of minor children must name a guardian. Be sure to discuss the matter with potential guardians. You want someone willing and able to do the job.

Choose an Executor

Most people name their spouse as executor. The next choice is a trusted relative, friend or business associate. If your estate is complex, a trusted CPA or attorney may be a better choice. A corporate trustee such as a bank or trust company can be another choice.

With the increase in life expectancy, you probably won’t need the executor’s services until you’re quite old, so pick someone younger than you, who is more likely to be around when needed.

Check Leftovers

The residual estate consists of those assets left over after specific bequests are paid. Let’s say your will provides that $10,000 will go to your favorite charity and the balance will be divided equally among your children. If you suffer financial reverses, assets will be taken from the children’s share. The charity gets paid first.

Express Last Wishes

If you want Grandma Sadie’s vase to go to your favorite niece, say so. If your will gives no hints, your executors will do what they think best.

You may also want to leave a letter with instructions about the type of funeral you want. The more specific you are, the fewer burdens will be placed on your family at a difficult time. Also, if you don’t want to be kept alive by extraordinary means, consider making a living will that states your opposition to such measures.

Remember – All Is Not ALL

A will doesn’t control the disposition of all your assets. For example, life insurance policies, retirement plans and IRAs go to the named beneficiaries. Joint tenancy property, such as your house and bank accounts go to the surviving joint tenant, regardless of what your will says.

Don’t Play Hide-and-Seek

A will that is impossible to find is worse than useless. A will remains valid until it is revoked. The law assumes that your last will reflects your current wishes, even if it’s 50 years old. If your current will can’t be located and an older one is around, the wrong will is going to be followed.

Put a copy in your safe deposit box, but ask your CPA or attorney to keep the original in his or her safe. Or, if you’ve named a bank or trust company as executor, ask an officer there to keep the original. Also keep a copy at home and let your primary beneficiaries know where it is.

Estate planning can be complicated. If you’re concerned about the future disposition of your estate and the consequences to your family and friends, seek help from your financial advisor.