What May Be Included in a Will?
A last will and testament can include multiple assets, some of which may not need to be listed, such as accounts with “rights of survivorship,” which is common on jointly-owned homes with a non-spouse, joint bank account, retirement accounts and others.
Your attorney should verify that your accounts have the right beneficiaries and right of survivorship in place during an annual review.
Items that may be included in a will are:
- Bonds and stocks (not held in beneficiary)
- Checking accounts
- Savings accounts
- Furniture
- Real estate that is not joint tenancy
- Businesses
- Guardianship
- Executor
- Caregivers for pets
- Gifts to charity
- The naming of someone to manage assets left to minors
If an asset has a way to be transferred outside of a will, it should be. For example, a life insurance policy will have a beneficiary designation, and this is the preferred way to transfer the policy rather than relying on a will.
Certain retirement assets, such as a 401(k) or IRA, will have beneficiaries that you can list, too.
You can, and should, consider how you want your assets divided. If you want your first child to receive a family heirloom, list it in your will to avoid the item going into probate.
We will work with you to create a will that includes every last important detail to protect your estate when you die. Your last wishes can be followed, but you need the proper legal documents in place.
Schedule a consultation with us to discuss creating or updating your will.
What Role Does a Will Play in a Comprehensive Estate Plan?
Your last will and testament is one small part of a comprehensive estate plan. Estate plans vary from one person to the next, but your will outlines the specifics of what happens to your assets upon your death.
If you don’t have a will, your assets will be subject to the law of intestacy, which may not be how you want your assets distributed.
Additional estate planning components may include:
- Power of Attorney
- Living trusts
- Medical directives
- Revocable trusts
Your estate plan may require asset protection planning, charitable planning, reducing taxes and more. Credit shelter trusts may be formed to maximize your tax exemptions.
A will is, often, the first document someone will create as part of a greater estate plan.
If you don’t want your assets to go into intestacy, a will ensures that your wishes are followed.
Add “Types of Wills” to Definitions section
Types of Wills
North Carolina accepts multiple types of wills:
- Attested — a will that is typewritten and signed in front of two witnesses.
- Handwritten — a will that is handwritten in the testator’s own writing.
- Oral/nuncupative — a will that is often created on a person’s deathbed and must be declared in front of two people.
- Joint will — a will that two people, often spouses, create together.
An attested will is the most common and easiest to prove that it is valid.
What is an Executor?
When drafting a will, you will be asked to name an executor. The executor is the person who will manage your financial affairs after your death. If probate is required, they will also handle this process or hire a lawyer.
Executors may have several duties, depending on the complexity of the estate. These include:
- Reading and filing the last will and testament.
- Locating and managing assets until they are distributed to heirs. The managing of assets may also involve deciding whether to sell securities or real estate owned by the decedent.
- Determining whether probate is required. Streamlined probate options may be available, and jointly owned assets may pass to the surviving owner without probate.
- Notifying creditors, banks and government agencies of the death. Executors may also terminate credit cards or leases.
- Pay debts, taxes and bills. An executor may also set up an estate bank account that will hold any money owed to the deceased person, such as stock dividends.
- Manage the distribution of the person’s assets.
Executors have a fiduciary duty, which means that they must act with the highest degree of honesty and impartiality on behalf of the deceased individual.
How Do I Choose an Executor?
Selecting an executor is not a decision to take lightly, and the person you name is not required to serve. Choosing the right person is crucial.
Consider the following:
- Will they have the time and inclination to deal with the paperwork?
- Will they have the capability of dealing with potential heirs and creditors fairly and calmly?
- Are they well-organized and able to juggle several tasks?
An executor does not necessarily have to be a trusted family member or friend. You also have the option of using a corporate fiduciary.
Do I Need a Will If I Have a Trust?
A trust can dictate how your assets are distributed, so you may assume that you do not need a will. However, everyone should have a will, even if they have a trust.
Here are a few reasons why:
- A will ensures that your trust functions properly. If you forget to put an asset in your trust, a pour-over will can serve as a backup to ensure it is distributed as per your wishes. A pour-over will allows you to fund the trust with any of the assets you may have overlooked before your death.
- A will allows you to name a guardian for minor children – something you cannot do with a trust.
Although a trust gives a great deal of control over how your assets are distributed, it does not negate the need for a will.
Your estate planning attorney can help ensure that your will and trust work together to carry out your last wishes.
The Risks of Probate
In North Carolina, it is possible to avoid having your estate probated. With the help of a lawyer, the process is straightforward.
What happens if an estate is probated?
In most cases, probate is simply a matter of completing a mountain of paperwork. However, there are some complications that can arise, especially with larger estates and if there is no last will and testament.
Some of the risks of probate can include:
- Family disputes. If an estate has valuable assets, heirs may argue over who should receive those assets in court.
- Court expenses. Probate does come at a cost, which includes but is not limited to filing fees and probate fees based on the estate’s personal property assets.
- Time. For a regular estate, the probate process can take anywhere from six to 12 months in North Carolina.
The probate process can be navigated with the help of an experienced lawyer, but planning and foresight can help families avoid these potential headaches.
