A will is a very important legal document for all adults irrespective of their financial standing. It allows you to establish an orderly transfer of your property and caretaking of your minor children per your desire should something unforeseen happens to you. Having a will also empowers you to implement your decisions while not being around. ...Show details

A will allows you to put checks and balances on your property transfer which you would enforce in case you were still around. For example, you would not want the creditors of your beneficiary go after the property you gave to this beneficiary. You can also build other rules and conditions if they are not met, then a property is not transferred to a beneficiary. Writing a will also gives you an opportunity to express your gratitude to those who cared for you. Through this document you can transfer a particular property in part or whole to an individual who you think will appreciate and respect it as you had desired. ...Show details

Not having a will leaves everything to a court's interpretation of laws of the state you live in. A court decided distribution of your property or designation of your minor children may not be what you would have desired. Imagine a situation, you and your spouse meet with a fatal accident and you have a minor child. Who you think will court assign to take care of your child, someone on your parents side or someone on your spouse's parents side? This is why, what you write in a will could be dramatically different from what the court prescribes.

To make sure your dependent children, especially minors (Under the age of 18 or 21 depending on the state) are taken care of per your wishes, you could set up a custodial account for each child through your will. This allows you to decide the custodian who will make decisions on how money is spent on their needs e.g. schooling. The custodial account ownership automatically transfers to the beneficiary child once he/she turns a major. The only downside to this arrangement is if your child turns out to be a big spender, this money may not be spent per your desire. Once the child is in full control of this account, the assets are also not protected from child's creditors. To avoid this risk, setting up a trust offers much more control.

The preparation of a will is fairly easy and not a very expensive. It is recommended to have it prepared by an estate attorney and have it registered. Estate attorneys typically charge a few hundred dollars. If you can't afford an attorney, then you can think about preparing a will on your own. Irrespective of how you prepare a will, it is important to keep it in a safe, yet easily retrievable place. A periodic review and an update of your will is strongly recommended. Some of the common scenarios when a will should be revised include, a change of address, life events e.g. a birth or death, or someone getting disabled in your family. ...Show details

If you decide to prepare the will on your own, make sure you have a few witnesses sign it. The witnesses should not be related to you and should not be benefited by your will. Close friends can be used as witnesses. If you don't want to share it with your friends either then you could also get it notarized by a notary public. It is generally not a good idea to have joint will with your spouse. Here are some of the key topics that a typical will includes. ...Show details

  • Personal information. Here, you provide your information e.g. your name, date of birth, street address etc.
  • Beneficiaries. In this section you list all the beneficiaries including your relationships to them.
  • Executor: You need to name an executor of your will. The role of executor is to carry out all the tasks of the will in an orderly and objective way. This could be someone whose judgment you value most and who you feel would carry out this duty diligently. Given the responsibility involved, you need to have a conversation with this person to make sure he/she would be willing to do this job. You also need to name an alternate executor in case the main executor is unable to carry out this role. Generally, this individual is a close relative or friend or a grown up son/daughter, but not a spouse.
  • Guardian: You also need to name a guardian if you have minor children. This person will take the custody of minors. Similar to executor, name a person who you trust would take a good care of your minor children. Here also identify an alternate guardian should something happens to main guardian.
  • Simultaneous death of spouse: For accidents involving the death of both spouses, you need to specify how your will should treat the order of death i.e whether you should be deemed as predeceased by your spouse. This is an important clause determining the transfer of property.
  • Simultaneous death of a beneficiary: You could specify how the share of a particular or any beneficiary be distributed in case this beneficiary dies with you.
  • Survivorship clause: Here, you specify how long a beneficiary must survive after your death, in order to be eligible for receiving a property from your will. This clause will prevent a property being included in 2 estates (yours and your beneficiary's) in quick succession. Given that estate taxes are substantial, a property going through quick estate taxation may have most of the value going to Uncle Sam.
  • Bequests: This is the main section where you specify which property in full or a fraction should be given to which beneficiary and when. Keep in mind that any jointly titled property e.g. a house or money in a bank or brokerage account is governed by the will if it is only in your name. Titling e.g. joint with rights of survivorship or tenancy by entirety can not be altered using the will.
  • Spendthrift clause: This provision is very helpful for a beneficiary who lacks spending judgment and as a result could incur a lot of debt and you don't want his creditors go after your bequest to this person.
  • All remaining property or residuary clause: In case a property is discovered that you did not specify above, you need to specify how this should be distributed.
  • Your signature, place, and date.
  • Witnesses.

Lately, there have been many cases where a person was declared terminally ill by doctors. A terminally ill patient is one who, according to the doctors, would survive for 6 months or less. Such cases get into various legal and family issues. Whereas a surviving spouse may prefer the life sustaining tube to be removed, the state law or family of terminally ill patient may not agree with it. It leads to a lot of emotional pain, sufferings, and often strained relationships among the loved ones . As a result, it is important to put your thoughts in writing via a 'Living Will'. ...Show details

A living will is a legal document and describes that you don't want a life sustaining treatment. Although it is recommended to get a living will prepared by an estate attorney, you can also prepare it on your own. A living will document should cover the following:

  • It should be addressed to your family, attending doctors, surgeons,  hospital and any medical care facility.
  • Declaration - you need to declare your firm belief in not having a life sustaining treatment when you lose the ability to communicate your wishes.
  • Directions - your directions to attending doctors/physicians to withhold or withdraw any life sustaining treatment if you get into a state where you are not curable or an irreversible mental or physical state with no reasonable possibility of medical recovery.
  • Witnesses - Have a few witnesses sign it.
  • Have the will notarized and registered in your state.

Other considerations: Check your state specific law around living wills. You can also elaborate on other details e.g. you may need life-sustaining treatment for x days, types of treatments you don't want to receive e.g. antibiotics, blood transfusions, invasive tests etc. You can also specify where you want to spend your last days e.g. at home rather than in a hospital, if it does not jeopardize the chance of your recovery. Some people like to include a declaration of donations of tissues and organs for advancement of medical or dental science/research.

You can amend certain provisions of a will in a separate document called codicil. A codicil allows you to change your will without actually rewriting the will. A codicil allows you to capture your wish list i.e. who should get what personal item that belongs to you.

  • Have an estate attorney prepare the will for you or prepare one on your own.
  • Review and update the will periodically (every couple of years) for any changes and also to validate your thinking toward beneficiaries, executors, guardians etc.
  • It may be useful to have a tactful discussion with your spouse and beneficiaries to assess their desires.
  • Store the will in a safe, yet easily retrievable place. Many people use the safety deposit box at their banks. Many banks allow survivors to search the safe deposit box of a deceased person for a will.
  • Tax return documents are a good source to find out where a deceased person had investment accounts because interest, dividends, capital gains/losses from such accounts are captured in tax forms. Make sure your dependents are fully aware of the location of your tax documents.
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