In case you’re wondering,
A will is a legal document that outlines how you want your property distributed when you die. It also includes who you would like to be the guardian of any minor children and what person should care for your pets after death. A will is not just about money or property, but it’s also about making sure that your loved ones know how much they mean to you and how much they mean to the people in your life. The following article will cover the basics of preparing a last will and testament so that you can leave this world with peace of mind knowing everything has been arranged as desired.
Making Your Will – Step by Step
Determine who you want to be your executor. This is the person responsible for carrying out your wishes and distributing what you leave behind when you die.
Create a list of all property that should go under “special” circumstances, such as life insurance policies or annuities with beneficiaries other than yourself. Your will should also specify how you want this property distributed.
#01. Make a List of Who You Want to Benefit From Your Estate
You want to divide your estate between the people in your life.
- children (if any)
- spouse and other close family members
- friends and acquaintances who have been helpful throughout your lifetime
When making a will it is important that everything be divided as desired or according to what has been agreed upon. Your will should also specify how you want this property distributed.
#02. Write Down Your Assets and Roughly What They’re Worth
Assets include everything you own, like cars or real estate and this includes anything that is in your bank account. This also includes any savings bonds, stocks, CDs, retirement accounts, etc. You want to list all of the assets that will be included on a final inventory sheet.
It is important to include all of the assets in your will from a financial standpoint.
You want to decide how you want these items distributed and specify what percentage each person should receive. If you are working with an estate planner, he or she may provide percentages for you based on their own estimations of how much it would take for someone to live comfortably.
You also want to choose the beneficiaries of any bank accounts, stocks or bonds.
If you are married, it is important that you name your spouse as a beneficiary on all assets. Your spouse automatically becomes the executor unless he/she declines this responsibility and another person needs to be named in which case they will need to sign a separate document authorizing them. If you are not married, the executor needs to be your next of kin or someone who has been appointed in your will as such.
When naming an heir for anything from property to accounts and assets it is important that they have at least 18 years old when you die. As a general rule, you should be able to rely on your spouse and children to take care of any funeral expenses. If there is a will in place, the executor can make decisions about how much money they are prepared to spend on things like flowers or an obituary.
#03.Think About How You Want to Split Your Money and Property When Making Your Will
Include a list of all your assets and how you want them to be distributed in your will.
You can specify how much, if anything at all, that each beneficiary should receive from what’s left after the bills are paid. There is not enough money for everyone to get an equal share they will be notified and can opt-out.
#04. Check if You’ll Have to Pay Inheritance Tax
This is usually a tax on the value of any assets passed to someone from their parents or grandparents.
In England and Wales, Inheritance Tax currently stands at 40% for anything over £325,000 in total; it’s 20% if you have less than that amount – worth bearing this in mind when making your will.
You can avoid Inheritance Tax if you use your annual allowance of up to £325,000 by giving gifts during your lifetime.
Once you’ve made your will, that might not be the end of the story. If anything major changes in terms of how much money or property you have, then there’s a chance that your estate could change substantially and so this means another revision may be needed.
#05. How to Protect Your Beneficiaries?
You can make a will to leave assets for your beneficiaries and this may be particularly relevant if you have children as well. This could include leaving an annual sum of money or property, like shares in a company. If the beneficiary is under 18 then they’ll need to be someone who takes care of their affairs – usually called a trustee.
On the other hand,
You can also leave a percentage of your assets to go towards their schooling or university – even if they are over 18. If you’re worried about how much money the person will need for living costs, then this is called an annuity and it’s not usually mentioned in a Will because people don’t know how much they will need. You can also leave property like your house or car.
What You Should Know?
- If it’s a family member, then the court would look at how well that person got on with their siblings and any other relatives before deciding what to do with those assets left in the Will. This is called the ‘rule of intestacy’.
- If it’s a friend, then the court would look at how close they were to you and what your relationship was like before deciding if that person should be given anything. This is called the ‘rule against perpetuity.
What to Do Once You’ve Made Your Will?
You should have a lawyer check your will before you’ve completed and signed it. This is called self-proving.
If there’s anything that you want to change in the future, or if someone has died and left something for you in their Will, then at that point just make a new will with the appropriate changes.
Keep in mind:
You should talk to a lawyer about how much money you have and what people are entitled to when you die, so they can advise on the best way for you to go about writing your Will.
Can I Leave Everything to One Person?
Yes, but you may want to specify how the property is distributed if that person dies before you do. You can also leave a portion of your estate in trust for children or other people who are not yet 18 years old and then decide when they reach the age of majority what percentage should go into their accounts.
How Much Is Too Much to Leave in a Will?
You may find that it’s better not to provide for your heirs with so many assets — this can cause serious problems when they go on their own and are faced with handling such large sums of money. It can be a good idea to leave your children with only the money they need for education or other purposes you have specified, and use life insurance instead of leaving them large sums.
Best Way to Leave Money in a Will?
One of the most common ways to leave money in a will is by naming an individual as your beneficiary. You can also give specific instructions about how that person should spend or invest the money left to them, such as specifying it be used for their education or other purposes you have selected. If there are several beneficiaries and one predeceases you, the money will be divided among the surviving beneficiaries.
What Should I Do if My Will Needs Updating?
It can become difficult to keep wills up-to-date as our lives change — we get married, divorced, have children or grandchildren. If will-related circumstances change, and those changes are significant enough that your heirs could be affected by them, it’s important to update your will accordingly.
It’s important to talk to a lawyer about how much money you have and what people are entitled to when you die, so they can advise on the best way for you to go about writing your Will.
If there’s anything that you want to change in the future, or if someone has died and left something for you in their will, then at that point just make a new will with appropriate changes.