How to Write a Will–and Why You Should Do It Now

You might not think you need a will, but estate planning is an important part of caring for your loved ones. Learn the basics of creating a will, from executors to beneficiaries, as well as the things a will does NOT cover.

No one likes to think about needing a will, but too many of us avoid thinking about it at all. Unfortunately, failing to make a will–even if you’re young, healthy, and don’t believe you have enough assets–can cause major issues for your loved ones if something happens to you.

What Is a Will?

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Simply put, a will is a set of legally binding instructions for how you want your estate to be handled in the event of your death. Most people focus on money, stocks, real estate, and other assets when they think of estate planning, but wills may also include the care of minor children.

Trusts Vs. Wills

Is a will the same thing as a trust? Although they are both parts of estate planning, they do not do the same thing. One of the main differences between the two is that a trust does not need to go through probate. If you’ve ever been involved in the execution of a will, then you know that probate can be a lengthy process even if the will is not contested.

Trusts do not go through probate and the assets in them do not become part of the public record, unlike wills. The downside is that trusts are much more complicated–and therefore expensive–to set up. If you are interested in a trust, then you’ll need to speak to an estate planning expert to understand your options and responsibilities.

Why You Need a Will Today

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Wills aren’t just for people of a certain age. Everyone–even you–should have a will in place. Parents or guardians with kids under eighteen in their care absolutely must have a will to protect their children. Even if you don’t think you have any assets worth splitting up, you should still have a will on file. Not only that, but you need to update your will any time you make a major life change.

Having a will on file can give you peace of mind. Beyond that, however, it can save your beneficiaries money. Proper estate planning can mean the difference between a swift, smooth division of assets and a drawn-out process with major tax liabilities for your heirs.

What a Will Doesn’t Cover

While a standard will can divvy up most of your assets, there are a few things that it cannot do. For example, you cannot will the payout from a life insurance policy to someone other than the person named as a beneficiary on that policy. You also can’t leave the money in a pension or retirement account to someone other than the named beneficiary on the account.

Your will is also not the place to detail your funeral instructions. Those should be part of a different document, which we’ll cover later in this post. The reason is that oftentimes, your will won’t be read until days or weeks after you’ve passed away.

Finally, there are limitations on the conditions you can include in your will. You can stipulate that beneficiaries can only receive their inheritance if they meet your conditions, such as graduating from college. However, you can’t make conditions that require the beneficiary to divorce their spouse, for example. If you want to include conditions in your will, talk to a lawyer about how to proceed.

Can You Skip the Lawyer?

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It is certainly possible to draft your own will, just as it’s possible to file your own taxes. The question is whether you want to take the DIY route. The answer depends on several factors, including the complexity of your personal finances and the amount of effort you’re willing to put in.

You can find templates and online programs to create a simple will in just a few steps. However, if you have a more complicated estate–or if you simply don’t want to take on the challenge yourself–then a trip to an estate planning attorney could be a better choice.

Take an Inventory

How can you make a final plan for your assets if you don’t know what you have? Before you start working on your will, you need to take inventory of your assets. You will want to be very specific about which assets go to which beneficiaries.

Assets include, but aren’t limited to, the following:

  • Real estate holdings
  • Cars and other vehicles
  • Jewelry, artwork, and other high-end goods
  • Checking and savings accounts
  • Retirement accounts and pensions
  • Stocks and bonds
  • Insurance policies

It’s a good idea to get tangible assets, such as jewelry and real estate, appraised so that you have the most accurate picture. In addition, you also need to take stock of your debts, including credit cards and mortgages. These may be counted against the total value of your estate.

Designate an Executor

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An executor is a person you trust to ensure that your wishes are carried out. Most often, this person will be a family member. If you don’t have anyone to name as your executor, another option would be to ask your attorney or even your accountant.

You’ll want to choose someone who is responsible and level-headed. Depending on your family and the scope of your assets, this could be a challenging task. Talk with the person you’d like to take it on to see how they feel. It’s also smart to designate someone younger than you since it lowers the risk that they will predecease you.

Choose Your Beneficiaries

A beneficiary is anyone who will receive something from your estate when you pass away. You have a lot of options when it comes to choosing your beneficiaries. Family members, friends, and other loved ones aren’t the only possibilities. Some people choose to leave money to their favorite charities.

Many people consider their pets to be family members, so it makes sense to provide for them in your will. It’s a smart idea to designate a trusted person to care for your pets as well as establish a trust to provide for their upkeep.

Make It Official

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If your will is not legally signed, then it is just a piece of paper. To be valid, your will must be witnessed by two people. They must be over the age of 18, and ideally, you would not choose someone who is also a beneficiary. In the event that your will is contested, these witnesses may need to give testimony in court. If you have your will prepared in an attorney’s office, they will most likely provide witnesses from their firm.

When you sign, you will initial every page of the document other than the final page, where you will sign in full. Next to your signature, include the date as well as the city where you signed the will. Experts recommend using a blue ink pen rather than black to make it more obvious that the document is the original. After you sign, the witnesses will do the same.

Safe Storage

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Do you have a designated safe place to store your documents? The best place to store your will is in a fireproof, waterproof lockbox in your home. This lockbox should not be a secret–you’ll need the executor of your will to find it, after all. Make sure that the executor has everything they need to access your will, including its location and any keys or combinations.

If you do not want to keep your will at home, then a safe deposit box at a bank is another good option. Just make sure that, again, your executor can access the box. You’ll need to arrange access with the bank and provide the executor with the location, box number, and key. If you worked with an estate planning attorney to draft your will, then that attorney will usually provide document storage for you.

When to Review and Update

Once you’ve created your will, it’s not truly done. People can be surprisingly lax about keeping a will updated. That can lead to unpleasant surprises for their loved ones. While it’s a good idea to review your will every five years or so, there are a few life events that require you to make immediate changes. Those events include:

  • When you are expecting your first child
  • When your child gets married
  • When you have decided to divorce
  • When an executor or beneficiary predeceases you
  • When your assets increase or decrease dramatically

One More Thing…

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Unfortunately, you aren’t quite done yet. Since there are things that your will won’t cover, then you need to cover the gaps. That’s where a Statement of Desires and Location of Property & Documents comes in. That’s a mouthful, but its purpose is straightforward. This document serves to state your final wishes, give an overview of your assets, and detail any life insurance policies you might have.

Another purpose of this document is to list the people who need to be notified in case something happens to you. It’s not a bad idea to restate high-level instructions for the care of any children or pets in your household. While this document isn’t legally binding, it’s an important part of estate planning. Make sure that it is accessible instead of locked away and that your loved ones know where to find it.

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