How to plan a will
Before their courtship, both Marty and
Carol Redman of San Diego could have posed for postage stamps representing
self-sufficient young Americans. Each was college-educated, self-supporting
and solidly employed -- Marty, 35, as a mechanical engineer, and
Carol, 32, as a laboratory technologist. Neither had much need for
anything as somber as a Last Will and Testament. Even after they
married in 1995, when estate planning was occasionally served up
as a dinner table topic, the whole death-will-inheritance thing
didn't seem to be a big priority.
That is, until Nathan James came along. When baby
made three earlier this year, the estate planning picture was reframed
for the Redmans. Suddenly, having wills drawn up took on new urgency.
"Marty and I were both independent before we got married,
so it wasn't like we wouldn't survive financially (if the other
died)," says Carol, who is now a full-time mom. "But now we've got
this totally dependent little guy, and we have to make sure he's
taken care of."
Big changes like birth, death and significant illness
are almost always the precipitators of the will-writing process,
says Maryland attorney Bill Dale. Upcoming surgery or a trip which
parents take without the kids can also get the ink flowing. But
while estate planning awareness levels may ebb and flow with the
tides of life, the four reasons for having death-related planning
documents never change.
So should I have a will or not?
According to Dale, you should have a will for the
- You have minor children. Anyone with
minor children should draft a careful will or trust that details
not only distribution of assets, but also guardianship. According
to Dale, court proceedings and disputes related to children of
parents who die intestate can be heart-wrenching -- and an unnecessary
albatross for kids already dealing with grief. Court-appointed
guardians must often negotiate legal labyrinths every time a decision
is made regarding the orphaned kids. But a guardian appointed
in a parent's will can help smooth turbulent waters for the children,
making decisions in the same way a parent would have.
- You want to control how your assets are
to be distributed. For those dying without a will, statutes
vary from state to state as to how assets will be distributed.
But one thing is certain: The state's desires for your worldly
goods may not be the same as yours. Taking the time to write a
will helps keep your wealth where you want it.
- Any of your assets are to be left to a
minor, an individual under a disability, or an individual whom
you wish to benefit from your assets without specific financial
control. In many cases, passing outright ownership of assets
is not a good idea. The obvious case in point is bequeathing assets
to minor children. But other examples include bequeathing assets
to someone mentally incapable of administering their own financial
affairs, or passing the benefits of assets to a spouse without
those assets becoming part of the spouse's estate, and thus subject
to certain estate taxes.
- You have tax planning objectives.
According to Dale, simple will and trust techniques can protect
more of your assets from the tax man. This is especially critical
when net assets exceed $600,000 (including life insurance benefits),
in which case Uncle Sam's cut exceeds one-third or more.
Now the above four reasons for writing a will aren't
exactly brain surgery. So why do even knowledgeable people put off
drafting one? According to Dale, the main reason is as old as Adam:
the unpleasant prospect of death itself.
"Most people don't like dealing with the issue of their own mortality,"
he says. "And it's an issue that never seems to have current urgency."
It's only when a death in the family, or some other major event,
hurtles over the horizon that most people are jolted into putting
their own affairs in order, Dale says.
So what's the first step to take when you are ready
to acknowledge your own finitude? Pick up the phone and call a lawyer.
Dale recommends hiring an attorney -- preferably one with estate
planning experience -- referred by someone you know and trust.
"Picking an attorney out of the Yellow Pages isn't
a good idea," Dale says, pointing out that while every attorney
will say they draft wills, many are not experienced enough to identify
and navigate more complex estate planning issues.
Marty and Carol Redman's parents referred their attorney.
Accountants and financial planners, who regularly deal with lawyers,
may also be a good referral source.
Another option for drafting a will is off-the-shelf
will-writing software. But Dale offers this caveat for computer-generated
testaments: While software can create a useful document in a reasonably
large percentage of cases, some people's heirs may suffer the consequences
of misplaced frugality.
"If I have a hangnail, I diagnose it myself," says
Dale. "If I think it's a cardiac problem, I see a doctor."
There's a good chance that money invested in an attorney-drafted
will will seem like small change compared to what a do-it-yourself
document could cost your heirs.
-- Posted: Oct. 23, 1998