Leaving a legacy for your intended beneficiaries is something we start thinking about in our senior years, so how do you make sure your finances and assets are passed down correctly? Getting the right advice and having a will that meets the legal requirements are great starting points.
1. Make sure your will is valid
A valid will could mean your last wishes are carried out, and it could prevent family disputes from happening. Having decided how you’d like your finances to be passed on, the last thing you’d want is to have an invalid will. Your lawyer will check your will conforms to the formalities in your state or territory.
You need to be at least 18. Your will has to be in writing, and it has to be signed and witnessed. In addition, you need to have testamentary capacity, which means you understand the effect of a will, are aware of your assets and are aware of the people who would normally be expected to benefit from your estate. Testamentary capacity also means you’re not prevented by reason of mental illness or mental disease from making rational decisions about who your beneficiaries are.
2. Nominate an executor
Nominating your executor is an integral part of writing your will, so what does the executor do? He or she carries out your wishes as outlined in your will. Your executor manages your estate and protects it, according to deceased estate laws. For example, he or she will look after funeral arrangements, locate the will, apply for probate, and collect assets to distribute to beneficiaries. Your executor is responsible for making sure all claims and debts are received, checked, and paid, in addition to a range of other obligations. This same person could also make sure other things are done, like paying rent for your apartment rent is paid on time, whether you have cheap rent in a city like Chicago or an expensive home in New York City.
3. Enduring power of attorney
Cognitive decline can impact testamentary capacity, and so it could impact the legal validity of your will if you update it when you don’t have testamentary capacity. With an enduring power of attorney, you nominate someone you trust to manage your financial affairs if you do become incapacitated at some stage.
4. Review your will regularly
Your circumstances and relationship might change, impacting your will. While they might not invalidate your will, these changes could lead to a higher risk of your will being challenged – an issue that could be avoided if you review and update your will regularly. A general rule might be to review your will every two to three years and whenever a major change affects your assets, family, and tax. Changes in tax regulations and other laws could also warrant an update to your will.
4. Appoint a guardian(s)
If you have dependent children, you’ll want to include provisions for them in your will. Appointing a guardian is probably the most important thing you can do in this respect. The guardian is the person who’s responsible for caring for and looking after your dependents until they’re 19 years of age. They make decisions about day-to-day care, upbringing, and property and money you leave to the dependants (as a trustee).
If you appoint a guardian, you not only ensure your dependents are looked after by the people you trust; you could help family members avoid disputes about guardianship.
5. Create your will with a lawyer
Will kits might not be able to address your individual circumstances, so getting professional advice for individual situations is key to having your final wishes carried out the way you want. Your lawyer can check your will conforms to the latest legal requirements and advise you on which properties you can include in your will. You can have confidence your will is legally valid. Your lawyer could also give you advice on tax optimization, the best structures for protecting your money, and how to handle things like business assets.
6. Communicate with loved ones
You could manage expectations and avoid conflict in the future by letting your loved ones know what’s in your will ahead of time. If your loved ones know well in advance, they could better understand why you chose to distribute your assets in a certain way, and they could be less likely to challenge your will.
7. Keep your will in a safe place
Keep your will in a safe place and make sure you tell loved ones where to find it so they can easily locate it. You might be able to deposit your will with the registrar of the applicable court in your state or territory. Alternatively, you could store it with your lawyer if he or she offers a secure service. Other options include safe deposit boxes, your own safe at home, and your state or territory State Trustee.
Along with having a valid will, you should update your will regularly and get professional advice from a lawyer. Check with your lawyer whenever your circumstances change and consider letting loved ones know what’s in your will as this could help you manage their expectations.
- Heralding Waffle Exchange: Here are The Pre-Sale Details - April 13, 2021
- Hugo Finance: The Boss Encouraging Governance Rights and Financial Freedom - April 12, 2021
- DeFi Yield Protocol Integrates with the Binance Smart Chain (BSC) - April 8, 2021
- Ethereum standard hashrate token–EHash: the innovative pioneer of hashrate token 2.0 - April 7, 2021
- Lendefi Community Announcement: An Outline of New Developments and Initiatives - April 2, 2021