Education Center » Why now is the time to write your will

Why now is the time to write your will

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It’s a simple step that can help protect your family’s future. Here’s what you need to know.

Here’s a shocker: More than half of Americans don’t have a will—including roughly a third of those 65 and older, according to a 2016 Gallup research poll.1 One possible reason: “People don’t like to plan for their own mortality,” says Jean Kim-Wall, a director and wealth strategist at Merrill Lynch.

But estate plans (which include wills) are less about your own future than they are about protecting your family—from discord, avoidable taxes and legal fees. Most importantly, a will gives you control. “If you don’t have one, the state will decide how your estate is handled,” says Kim-Wall.

“Whether you’re nearing retirement or just starting a family, it’s a good idea to put your wishes down in writing,” Kim-Wall adds. Start by assessing your net worth and considering your short and long-term goals. “Think about how you want to pass on your legacy,” she suggests. “An estate planning attorney can help you fine-tune your initial thoughts and make everything official by drafting the necessary documents.” And bring your family into the conversation as well, to make sure they understand your wishes and how you’d like them carried out.

A will can help you avoid…

Court costs

Depending on state law, probate and filing costs could erode your estate’s value if you have no will.


Family conflict

Without a will in place, your heirs are left to vie for favorite heirlooms and possessions.


Emotional pain

Tracking down assets and records is a tremendous time commitment for your mourning family.

A will can always be updated as circumstances change, and it’s far better to have a will that’s suitable for your current situation than to have no will at all.

According to Kim-Wall, every estate plan should address these three things:

Your heirs—and their inheritance

Naming who inherits what from your estate is the first step. And while dividing up your financial assets is important, also think about whether you have any personal belongings that you’d like specific people to have. These may be heirlooms of sentimental value or a beloved collection. Don’t forget that estate planning in a digital world means that you might have things like videos and photos on your personal computer or mobile phone that your family might like to have—so be sure to determine who will get access to your passwords.

You’ll also have to consider the ways in which your assets are passed on, whether it’s directly to your heirs or via a trust. Any assets you leave directly to heirs can be used or spent at their discretion, whenever they choose. A trust, on the other hand, allows you to set rules for how and when any assets you leave might be disbursed. This is particularly useful if you’re leaving assets to minors or to someone who is not able to manage their own finances, perhaps because of a disability.

Another situation where a trust could help is if you’ve remarried later in life and are wondering about how to care for your current spouse while also leaving enough for children from an earlier relationship. Trusts can be drafted to be very flexible; for example, you may allow your current spouse to receive an income while protecting what’s left for your children.

Who will make sure your wishes are carried out?

The executor will act as a sort of administrator for everything you leave behind. “The executor will take inventory of your assets, pay any outstanding bills, settle your affairs, make sure your mandatory filings are done and pay any estate taxes,” says Kim-Wall—so select someone you trust who would be good at those things. “People will often name a family member or a trusted friend,” she adds, “but if you have complex assets or family dynamics, it makes sense to consider a corporate fiduciary to handle these matters.” (A corporate fiduciary is an organization that’s entrusted with the job of managing your financial affairs.)

If you have minor children, you’ll also need to name a guardian or guardians—the person who would look after them if you and their other legal parent were both to die. Even though it’s a remote possibility, you’ll want to check with this person first, because it’s a significant responsibility.

What happens if things change?

Wills can become outdated quickly, so try to make sure yours spells out how you want to account for major life events like births, deaths, marriages and divorces. But whatever you do, don’t let the complexity of thinking through multiple hypothetical events discourage you from making a will in the first place. A will can always be updated as circumstances change, and it’s far better to have a will that’s suitable for your current situation than to have no will at all. “This is one circumstance where ‘good enough’ is not so bad, because it’s still much better than having nothing in place,” says Kim-Wall. You’ll want to take a look at your will every few years anyway, to make sure it accurately reflects your wishes and the latest circumstances of your life.

Learn more and take action

 
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1 Source: Gallup.com, “Majority in U.S. Do Not Have a Will,” May 18, 2016.

Neither Merrill Lynch nor any of its affiliates or financial advisors provide legal, tax or accounting advice. You should consult your legal and/or tax advisors before making any financial decisions.

Please keep in mind Merrill Lynch does not provide Estate Planning, tax or legal advice.

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