A. Definition and Description of Will
A Will is a statement you make directing how you want your property to be distributed at your death. Anyone who is at least eighteen years old and of sound mind can make a Will. A Will does not take effect until you die. So, as long as you are of sound mind, you can change your Will as often as your wishes or circumstances change.
There are different types of Wills, but a Will almost always has to be written to be valid. A Will written entirely in your own handwriting is called a Holographic Will. This type of Will may not be valid in every state. A written Will that is properly witnessed is called an Attested Will. An Attested Will with a special notarized affidavit is a Self-Proving Will.
B. Purposes/Functions/Benefits of a Will
There are several things that you can accomplish with your Will.
1. Beneficiaries. The most obvious is that you can direct how your property will be distributed. Those persons you name in your Will to take your property are called beneficiaries. You get to select your own beneficiaries. In naming them, you should provide for several contingencies, because you don’t know who will be living at the time of your death.
For example, if you are married and have children, you may want to leave everything to your spouse, and provide that if your spouse dies before you or at the same time, then everything is to go to your children. You should also provide for the possibility that one of your children could die before you. If that were to happen, where would you want that share to go? To his or her children? Or to your other children? What if you were not survived by your spouse, nor your children or grandchildren? You may want to provide for that possibility as well.
I know it is not easy to think about your own death, and it’s probably even more difficult to think about your spouse or children dying before you. As uncomfortable as that might be, you’ll have a much better Will if you do plan for those possibilities.
2. Executor. Another benefit of having a Will is that you get to choose your own executor. The executor is the person who is appointed to administer your estate. The person you name to be the executor does not actually become your executor until your Will is probated and the probate court officially appoints him or her. The executor has three main functions: (1) to gather and protect your assets; (2) to pay your debts and expenses, including any taxes; and (3) to distribute your remaining probate assets to your beneficiaries as provided in your Will.
Your executor should be someone whose integrity and judgment you trust. It helps if your executor has some business sense, but that is not an absolute requirement if he or she has enough common sense to seek the assistance of professional advisors.
Most married people will name their spouse as their executor, but whether you are married or not, your Will should provide for one or two alternates in case your first choice is unable or unwilling to serve as executor. Some people will name their attorney or a bank to be their executor or alternate executor.
You may name more than one person to act as executor jointly. They are called co-executors. This may be appropriate in some cases, but because both co-executors generally have to agree on everything and sign everything, it may be more inconvenient than it is worth.
3. Guardian. Another thing that you can do in your Will is to name the person you want to be the guardian of your children in the event you are the last surviving parent. The guardian is the person who is appointed by the court to raise your children until their eighteenth birthday. Normally, the court will follow your wishes as expressed in your Will.
For those who do have minor children, this is often the most difficult decision to make. As with the executor, it’s best if your Will provides for one or two alternates.
4. Trustee. One other thing you can do in your Will is to set up a trust and name a trustee. A trust is a special legal arrangement that divides the ownership or title to property into two parts, legal title and beneficial title. The trustee is the person holding legal title. He controls and manages the property according to your instructions for the benefit of the beneficiaries, who hold beneficial title. Basically a trust is a way you can leave property to someone such as your child, but have someone else, the trustee, manage that property for the child’s benefit. You not only name the trustee, but you can specify how and when the trustee is to distribute property to your child. Again, your Will should allow for one or two alternates for the trustee. A trust that you set up in your Will is called a testamentary trust.
Here is an example of how a trust can be useful. Let’s say your Will leaves everything to your spouse, and then to your children if your spouse has died before you. But if your children are minors, the court will normally have to appoint a guardian to manage their assets. The guardian is normally required to post a bond, file an inventory and file accountings with the court every year. Often, the guardian must get permission from the Court to spend any of the money for the children. Not only that, but as soon as the minor becomes a legal adult, usually 18, the child gets it all outright. Most 18 year-olds aren’t ready to handle that.
On the other hand, if you have a trust set up for your children, you can specify whether or not the trustee must post a bond or file inventories or accountings with the court. You can also give the trustee as much or as little discretion about how to spend or invest the assets. You can also specify the age that the trustee is to turn the property over to the child, which may vary depending on the amount the child is likely to inherit and your opinion as to his or her ability to act responsibly with such an inheritance. In other words, your trustee can make sure that the funds are used wisely, such as to pay for their college education, or to put a down payment on a house before your child gets outright control of the inheritance.