Did you know that you can die intestate? Don’t worry, it isn’t something that Lance Armstrong has. Intestacy means that you die without a will or other legal device to allow the state to determine your intentions upon your death. I know, most people are more worried about how to avoid dying and not thinking about what happens after they die. Actually though, one should be just as concerned with one’s legacy as they are with their life, because not taking care of it can royally screw up the lives of the loved ones you leave behind.
I doubt most people want to leave their loved ones in a state of chaos (well maybe some really rich socialites, who don’t really like their children, and leave their massive estate to their pet; think Leona Hemsley. Dont worry I will discuss pet trusts in a later post.) Dying intestate shows that you are willing to let someone else decide how your property should be dealt with. It also means that the state decides who raises your minor children. It means the state determines who gets your favorite heirloom. It also means that you didn’t plan your estate to protect it from taxes as much as possible, so the rich intestate decedant (dead person in legalese) is paying the state, through really high inheritance taxes, to make decisions for them. Notice that rich people rarely die intestate? (Howard Hughes being the exception.)
You don’t have to be rich to have a simple estate plan. Don’t think of an estate as a giant mansion. Think of it as everything you own. Even if all you own is the clothes on your back and a dog. Remember, someone will have to care for that dog after you die. What do you think the state will do? Now that I have convinced you that maybe you should do some estate planning let’s talk about options.
The easiest estate planning device is the simple will. All you need is a piece of paper, a signature (preferably your own), and two witnesses. There is a little catch on choosing witnesses. They shouldn’t be someone who will be named as a recipient in the will. That way if someone contests the will the witness doesn’t have an ulterior motive to see that the will gets interpreted in their own favor. Don’t make your child a witness.
Also, something to consider, is you may need this person to testify as to the authenticity of your will, so you might want to choose someone who will be around for a while; asking your 95-year-old grandmother or a wandering homeless person to be your witness may be a mistake. My wife and I made our original wills and had a friend and his wife witness them. We also gave him a copy to keep in his files, so in case something happens to the originals that we keep in our safe deposit box, there is another readily accessible copy in the world.
The witnesses do not necessarily have to be there when the will is signed. They do need to sign that they either witnessed you sign or that you attested the signature on the will was your own before them. Either way, you should do something nice for the witnesses. Take them out to lunch or ge them a small gift. After all, they should know they won’t be getting anything under the will. Even better have the attorney who draws up the will sign as a witness. They will need to keep your documents handy for years to come and you are already paying them so why not use them?
The will is the way you speak for yourself after death. A valid will allows you to determine, within the law, how your property is divided, who cares for your underage children, how and where you wish to be buried, etc. It would be advisable to consider what you want prior to writing your will. I suggest that you make a list of your property and a list of people you want to leave something to. Then begin assigning who gets what.
As Washington is a community property state, (I will attempt to explain community property in a different post. For now just accept that it is), there may be limitations of what you can give away other than to your spouse. Usually a person can give away a divided 1/2 interest in the community property and all of their separate property. Determining which is which sometimes requires a lawyer, but that again will come in a future post.
One drawback to the simple will is that when you die, the will has to go through a legal process called probate. This usually requires a lawyer and will cost some money in court fees. Probate also takes time, sometimes months, which means that your estate is tied up until probate is over.
There are devices to avoid probate, such as trusts. There are many types of trusts so I will discuss those in a later post, also. Trusts are more sophisticated tools and require a bit more management than a will that you can write and forget. It can however do things a will can not like shield the assets you leave to a child with poor money management skills from creditors. It can also provide an income to a young child to pay for future college or pay for special needs. The trade-off is there are higher costs associated with writing a trust. A trained lawyer is recommended to help you make the decision of which options to choose.
For now, just please make sure that you have some plan in mind in case you die. Whether you choose a simple will or a trust, knowing that you are making your own decisions should give you peace of mind….and that is priceless.
Vandenberg Law 