You Do Have a Will, Don't You?
Everyone who is of legal age and has any assets at all should have a will. If you don't, and you die, the court will determine how your property gets distributed. It also will appoint somebody to take charge of closing out your estate. The person or firm appointed can charge up to 5 percent of the value of the estate, which won't come as a nice surprise to your survivors.
Most lawyers will draft a basic will for about $300, and it's an investment you simply can't afford to be without.
Don't Go There
Beware of generic wills that you can buy in office supply stores or stationary stores. Not all states accept generic documents, and these forms aren't customized, so they may not be exactly what you need.
What It Should Include
A will does not have to be long or complicated, or filled with language that nobody can understand. It does, however, need to include certain information. Basically, a will contains a description of a person's assets, property, and belongings. And it describes how those things are to be divided after the person's death.
A will also can contain specific instructions assigning certain items to individuals, and should name an executor to handle the estate. The executor is the person who administers the estate of the person who has died.
Many people include a letter of instruction along with their will to address more personal and specific issues. Some of those issues could include the following:
Special instructions for the funeral or burial
Detailed lists of possessions to be passed along to various people
Locations of all important documents and items
Personal messages to family members or friends
A letter of instruction should not be kept with the actual will, but in a spot that is easily accessible in the event of your death. And make sure that your spouse or another trusted person knows that it's there. You can leave the most specific instructions possible for your funeral or burial, but if nobody finds them until three days after you've been buried, they're of no use.
Most married people name their spouse as the executor, unless there's a specific reason not to. When choosing an executor, keep in mind that it can be a time-consuming, tedious job. Don't appoint someone who will be overly burdened by the work involved.
An executor normally is responsible for seeing that the wishes of the deceased person are carried out, and for paying any owed taxes or outstanding bills. Other duties of an executor may include closing bank accounts, arranging for appraisals of assets, filing insurance claims, inventorying assets, notifying creditors, setting up checking accounts to use to pay bills, informing beneficiaries and distributing bequests, and filing final income tax returns.
When including an executor in your will, keep in mind all that is involved, and be considerate. Make sure the person you choose has both the time and ability for the job.
More on: Family Finances
Excerpted from The Complete Idiot's Guide to Personal Finance in Your 40s and 50s © 2002 by Sarah Young Fisher and Susan Shelly. All rights reserved including the right of reproduction in whole or in part in any form. Used by arrangement with Alpha Books, a member of Penguin Group (USA) Inc.
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