Estate Planning with Wills

Most people know about wills and their basic purpose – to ensure that one’s hard earned assets go to the right beneficiaries when an individual passes away. However, wills can be used for a lot more than simply dictating who gets a person’s antique lamp collection. Here’s a list of some of the very valuable things a will can do:

  • List who gets what. The most common purpose for a will is to name which individual, or group of individuals, will receive particular property belonging to a person when he or she passes away.
  • Name guardians for children. Typically, a will is the document that states who should raise a person’s children if something happens to the parent. The will also usually contains at least one alternate in the event the first choice cannot serve.
  • Establish trusts. In many cases, a person may not want a child or loved one to receive all of their inheritance at once. Sometimes a person may want a beneficiary to have use of property for a while (i.e. lifetime), and then for the remaining property to pass on to others. In that situation, an individual may choose to use a trust to ensure the plan is carried out. A trust holds property on someone else’s behalf. Trusts are commonly established for beneficiaries (i.e. children) in order to protect the assets for their use until they reach a certain age or until the remaining assets are distributed to successive beneficiaries (i.e. grandchildren). Trusts are also commonly used in second marriage situations – a person may want to allow a spouse to have access to certain property while the spouse is living, but for that property to ultimately pass to the decedent’s children or grandchildren. Trusts can help accomplish that goal.
  • List funeral wishes. Although these wishes are sometimes listed in other documents, a will commonly states whether an individual wants to be buried or cremated, and where the body should be buried or the ashes should be spread.
  • Tax planning. Although a separate trust provides more flexibility and options, wills can be used for tax planning in order to reduce or eliminate estate or inheritance taxes, save income taxes, and allow for more tax planning. This can sometimes be accomplished by establishing that various trusts be created based on the instructions in the will.
  • Naming a personal representative and trustee. A will usually states who will be the personal representative of an estate, which is the person who will carry out a deceased individual’s wishes listed in the will. Wills can also name the trustee of any trusts established in a will, which is the person who will be in charge of carrying out the instructions of the trusts.

While wills can serve as powerful estate planning tools, they are only effective if they are properly drafted to suit the needs of each individual. An estate planning attorney can review options with you and establish a will in a manner that ensures your wishes will be honored.

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