TEXAS, USA — August is National Make a Will Month, and it's never too late to start thinking about planning your will, and your wishes for your estate after your death.
People tend to think planning a will is morbid, but it's actually about life and making sure that your assets provide support for the people you love. It isn't about controlling from the grave, it's about creating opportunities that continue to give benefit for years to come.
According to a recent Gallup Poll, only 44% of Americans have a will. Here are the different elements.
An estate plan is more comprehensive than your will – in fact, both a last will and testament and a living will are usually part of the estate plan. First, an estate plan identifies the people you want to benefit from your assets. Second, an estate plan identifies the people you trust to take care of yourself and your assets if you're unable to do so.
A last will and testament is a legally binding document that distributes your assets and assigns heirs and guardians after your death.
A living will (a.k.a an advanced directive) is a document that grants trusted advisors to navigate financial and health decisions should you become incapacitated.
A trust can also be part of an estate plan, and is a legal entity you set up to hold, safeguard, distribute and control all your assets.
You should also should decide who will be your medical power of attorney and would be making the decisions on your health should you become incapacitated.
Here are the components of a will:
- You should be at least 18 years old
- You should be of "sound mind"
- You will need to include what you want done with your assets and property, and if you have minor children, include who will become guardian
- Usually wills are typed or generated by a computer, and should include the statement that this document is your will
- You should appoint an executor who will ensure your estate is distributed correctly according to your will
- You should have at least two witnesses who will see you sign the will, are 18 years or older, and are not beneficiaries of your will, and will also sign the will
All of this will make the transition much smoother. If you die without a will, the state could be involved, and probate could take a year or two to distribute.
It's also important to update your wishes every 5 or 10 years as you enter different life stages and your children become adults themselves, as different decisions need to be made for different life stages.