What’s a will? Is a living will better than a regular will? Do I need a will? Does a will avoid probate? Let’s answer these great questions.
Every adult needs 4 basic estate planning documents: (1) a will (and/or trust), (2) a living will, (3) a durable financial power of attorney, and (4) a durable medical power of attorney.
- A Will goes into effect at your death, appoints an executor to handle your estate, and specifies who receives your property. A Will has some custom provisions for your unique family situation and desires, with standard provisions defining your executor’s powers and giving them broad latitude to handle your last affairs under state law.
- A living will isn’t better than a regular will (or an upgrade to a will) – they’re both vital, but they do different things, like a hammer and a screwdriver.
- Yes, you need a Will. A Will ensures your property and assets are distributed to the people you care about and that your finances and final affairs are taken care of well. If you don’t execute a Will (or trust), your property passes under the default options of state law. By making a will, you choose who gets what; by not making a will, Kansas or Missouri chooses who gets what.
- No, a will does not avoid probate. In fact, a will has to be submitted to probate to be legally binding after someone dies. But depending on the size and complexity of a person’s estate, probate may be a simple, quick deal.
Probate and estates. When a person dies, all their assets and liabilities become their estate. An estate usually goes through the county probate court, unless (1) the deceased person’s assets all pass outside of probate or (2) the size is too small for probate. Probate has a bad reputation in most people’s minds, but it’s often actually fairly quick and inexpensive. Probate can sometimes take several weeks or months depending on the family dynamics and estate’s complexity. The family hires a lawyer to talk with the judge, say this person died, here are their assets, here’s the will, and we want to follow the will to distribute the assets. If everyone gets along, the judge usually signs off and things get settled shortly.
Avoiding probate. Assets can pass outside of probate, by trust, beneficiary deed, transfer on death deed, pay on death, beneficiary designations, or joint tenancy. Married couples often own a house as joint tenants, so the surviving spouse/tenant gets the house without probate. Beneficiary deeds and transfer on death deeds are different names for the same thing, where the owner specifies who gets the property upon their death. Pay and death and beneficiary designations are used for life insurance, retirement accounts, and accounts at banks or other financial institutions.
Do I need a trust? Can I avoid probate without a trust? Clients can save money and avoid probate by being sure everything is titled to pass outside probate upon their death (a piecemeal approach). Trusts can be more convenient, an ownership umbrella for everything that avoids probate, but many clients can get the same benefits without paying for the extra documents/paperwork.
Small estates. Kansas and Missouri both have exceptions for “small estates” – under about $40,000. So if someone dies with less than $40,000 in their name, there’s a simple affidavit their relatives take to the bank to transfer the assets, without having to step foot in court.
What about Legal Zoom, Rocket Lawyer, or other inexpensive services? Let’s answer the question everybody’s thinking, but nobody wants to ask. You get what you pay for, and hiring a lawyer is affordable. My firm has seen Wills and estate planning documents done by Legal Zoom, ones done by well known local firms, and homemade Wills. My firm often ends up fixing estate plans done by Legal Zoom or homemade/library forms, since they’re not prepared by licensed local attorneys, they’re usually not properly signed, witnessed, or notarized, they’re often missing vital ingredients, have complicated legalese, or have excess provisions clients don’t want, need, or understand. One document talked about the California Probate Code when the document was supposed to avoid probate and the client had no connection or property in California. Why? Because an automated Internet service didn’t know any better, but we quickly fixed the document for the client. (Some online legal services have law professors review their forms, but law professors often aren’t licensed attorneys or don’t have any practical experience meeting with clients and preparing documents, so they may not know what to look for, what traps to avoid, and how to customize documents for clients’ unique needs and family situations.) Many clients are surprised by how affordable a Will is – do yourself and your family a favor and hire a local lawyer to do your Will.
My law firm, Johnson Law KC LLC, can help you make a Will and get your estate plan done quickly and affordably. Call (913.707.9220) or email us (email@example.com) to schedule a free, convenient consultation.
(c) 2015, Stephen M. Johnson, Esq.