Do I Need a Will?

The answer to whether someone should have a will is almost always "yes". The next answer is, "Yes, you should see a lawyer about having it done."

A SIDENOTE

Something that amazes me is how often people who seem perfectly sensible will buy a very expensive 'trust kit' from someone from out of town who rents a motel conference room for an 'estate seminar'. I once had someone come to see me who started having second thoughts about buying into one of those, but who wanted to vigorously defend the decision to do so instead of listening to my advice about it. I suppose that once you've thrown that much money at one of those over-priced do-it-yourself kits, you don't want to think that you've made a bad decision.

WHAT DOES THE WILL DO?

Your will is your say-so as to what happens to your stuff after you're gone. There are a few limits. For instance, in North Carolina, you can't leave your fortune to your cat (although you can leave it to a trustee with instructions that the money be used for the cat's care). You can't completely leave your spouse out of your estate either, unless you've got a valid pre- or post- nuptial contract that allows it. And if someone can prove that your were incompetent when you wrote the will or that somebody seriously took advantage of you or forced you to write it the way you did, they might be able to overturn it. Otherwise, what you say goes. If you choose to leave nothing to the grown kids because they've ignored you for years, that'll work. Your children have no inherent right to receive anything from your estate (although your estate may still be liable for the support of your minor children).

If you choose, you can leave everything to one person, or you can divide the estate among any number of people. You can leave specific items to specific people and the rest to others. You can even use the will to set up a trust or trusts. The will is your chance to divy it up any way you want.

WHAT IF I ALREADY HAVE A TRUST?

Even if you have a trust and have beneficiaries named on all your insurance policies and accounts, you still should have a will as a backup. At some point, you might forget to title some new asset (such as a car) into the trust, or you might forget to change beneficiaries on an account after one of them has died. Your will can act as a catch-all to direct where those undesignated assets will go.

IF I DON'T HAVE A WILL, DOES THE STATE GET ALL MY STUFF?

Short answer: No. Slightly longer answer: Maybe, if nobody's left to get the stuff. A set of laws called the 'Intestate Succession Act' sets out a pecking order of relatives who will share in your estate if you have no will. The only time it goes to the State is if you have no relatives who can be found. Even then, the state will not own your property; it goes into what's called an 'escheat' fund until someone shows up who can prove kinship to you.

The pecking order starts in a vertical direction, once your spouse is taken care of. Children and parents take first. If you have no children or parents surviving, then it starts going sideways, to siblings, aunts, uncles, and the like, as far as necessary to find someone within some degree of kinship. Your attorney can tell you more precisely how the pecking order works.

DO I NEED A TRUST?

Not everyone needs a trust. A small percentage of the population might need one to avoid some estate taxes (sometimes called death taxes) for. Also, people who have combined families and want a little more assurance that their separate assets go to their own children might benefit from a trust. There may be other specific reasons to create trusts as well. Keep in mind though, that creating a trust simply to avoid creditors can be a risky proposition--you'll pretty much need to lose control of your assets for it to work.

If you think you might have a reason to need a trust, talk to your attorney. 'Avoiding probate' is not necessarily a good reason to have a trust, especially in North Carolina, where probate is not that expensive.

CAN I WRITE MY OWN WILL?

Sure you can. But you take your chances that it won't do what you think it will. Every once in a while, I'll come across a home-made will in which someone downloaded a form from the internet or copied one from some other source, but completely botched filling in the blanks, or failed to have it properly witnessed, for example. Your attorney will know what it takes to make the will valid and will know what language to use to put your wishes on paper. The attorney will also be able to advise you about what you can't do.

As always, this has been a short talk on the subject at hand. If you have more general questions about wills, please feel free to post them. For more specific questions about your own estate planning, you should consult your own attorney.