People have the ability to control how assets are used. If they want to buy something fun for a family member, they can. If they want to support a loved one, no problem. Contributing to a charity is often easily arranged. However, these simple tasks are not so simple after a person passes away.
August is national Make-A-Will month, but why is it important to make a will, and why should I have one?
When people are planning for their own death, they often decide to create a will. In this will, they will be able to distribute their assets to whomever they choose. With the creation of a will, people will be able to give their loved ones a clear understanding about how they want their assets to be used after they are gone.
A will serves many different functions. Most people understand that it helps to designate who will receive one's property when that person dies. However, it can do more than that. One area where a will is extremely important is appointing a guardian for people's wards.
Many people think that estate planning is an issue relevant only to older people who are advancing in age. In reality, however, death sometimes strikes unexpectedly, even when people are young and in the prime of their lives. Thinking about estate planning and creating a will has numerous benefits beyond simply indicating who will receive the deceased individual's possessions. In fact, one of the most important parts of wills drafted by younger people is naming a guardian for children.
One of the most important, and commonly understood, parts of estate planning is the creation of a will. However, despite many people's familiarity with the concept of a will, many people still do not understand some of the intricacies or complexity in the will creation process. First of all, there are different types of wills. While different types of wills can all be legally valid-if they are created correctly-each type of will may not be applicable or well-suited to every situation.
Many people are familiar with the purpose of a will. They understand that one of its primary purposes is to direct how assets will be distributed, and to whom, upon the will creator's death. Another important, yet commonly overlooked, element of estate planning is a living will. Although it is similar to a traditional will in that it is a written document with legal force, there are many differences between a standard will and a living will.
In several posts on this blog we have discussed numerous estate planning topics as it relates to wills. One important theme throughout these discussions is ensuring that your estate planning documents will be considered valid at the time they are executed.
Any of our Michigan readers familiar with previous posts here know that there are a wide variety of estate planning instruments to consider when it comes to protecting assets and avoiding probate litigation. Some will choose trusts because of the relative ease with which assets can be passed on to future generations. Others choose the tried-and-true will, in which the estate planner can designate property distribution as well as detail important decisions like naming guardians for minor children. There are many approaches, and having an estate plan is almost always better than leaving an estate in the hands of state intestate laws.
Our Michigan readers are probably familiar with numerous posts here that have detailed the many various parts that can make up a comprehensive estate plan. Considering the benefits of trusts, long-term planning and powers of attorney is part of evaluating which components are right for each individual or family's situation. With so many options to consider, most Michigan residents would probably think that over-planning is more likely to occur than coming up short. But, according to a recent article, having an estate plan that is less than comprehensive is one of the more common mistakes in estate planning.