Understanding the Basic Will

Understanding the Basic Will

Understanding the Basic Will

A basic Last Will and Testament is a legal document that can be quickly created in order to ensure your final wishes are stated and honored upon your death. If you currently have no estate plan, it is a good idea to put forth a Will to cover the essentials of your estate. Once you have a basic plan in place, you can determine if you need additional planning now or may need it in the future.

What It Does

A basic Will does four things. It allows you to name the beneficiaries you wish to receive your assets, and to name an executor who will use the instructions in your Will to settle your final affairs. If you have minor children, you can use a Basic Will to name a guardian and to state who will handle your children's inheritance until they reach adulthood.

What it Doesn't Do

If you choose to use a Last Will and Testament, you must understand what your document cannot do. A will cannot avoid probate. Probate is the process of court-administered settling of an estate after someone dies. In order for the Will to operate, it must be probated. If your assets are small probate may be a very simple process, but it still costs money and takes time frequently six months for simple estates. If your holdings are large, probate may take significantly longer and cost considerably more money. Your basic Will also cannot handle special inheritance wishes. Inheritances are simply left out-right to an heir, unless your will also incorporates a Testamentary Trust.

Is it Enough?

If your estate is likely to owe estate taxes, a basic Will may not be enough for you. Instead, it is best to seek out ways to reduce your taxable estate in order to preserve the inheritance of your loved ones.

Also, if you have minor children and are leaving them a substantial inheritance, it may be best to use another estate plan. When a large inheritance is left in a Will, your child will have full access at the onset of adulthood. Many new adults may not be responsible enough to manage a lump sum inheritance. Trusts area great alternative to provide a gradual inheritance until an heir is of a more mature age. Such a trust can either be incorporated into the Will, or be a stand-alone document. When executed as a stand-alone document, your estate can also avoid the expense and delays of probate.

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