Why Do I Need a Will?
While many people assume that their spouse will automatically inherit their assets if they die, this may not be the case. If you die without a Last Will and Testament, your assets will be distributed according to the Laws of Intestacy. If you die intestate in New York State, your wife would only be entitled to the first fifty thousand dollars ($50,000.00) and one half of your residuary estate. Your residuary estate will consist all of the assets left in your sole name without a beneficiary designated after your debts have been satisfied. The other one half of your estate will be divided between your surviving children.
What About Jointly Held Assets?Accordingly, if all your assets are jointly held with your spouse or if you have named your spouse as a beneficiary, there may indeed be no need for a Will. This is because you would have no "estate" for probate purposes. All of the assets would automatically pass to your surviving spouse. However, there are many assets which cannot designate a beneficiary the way an insurance policy or retirement account can. For instance, if you own a business or real property in your sole name, those assets would be part of your residuary estate. Without a Will directing that these assets pass to your spouse, she would be forced to share these assets with your children. Despite your intention, this could potentially force the liquidation or sale of your assets, leaving your wife to face financial hardship upon your death.
Other ConsequencesFailing to execute a Will could result in some other unintended consequences as well. One of the biggest reasons to create a Will is the ability to create testamentary trusts. These are trusts that spring into effect at your death. The most common trusts are tax planning trusts, which ensure that your exemption will be effectively utilized, Descendants Trusts, which ensure that assets passing to your children are creditor protected and Supplemental Needs Trusts, which ensure that any beneficiary who is disabled can inherit assets through your Will in a way which will not supplant their government benefits.
Most Important Aspect of Executing a WillLastly, executing a Will allows you to designate an Executor, or the person who will be in charge of the management of the distribution of your Estate. In the absence of a Will, the Court will appoint an Administrator to do this and it might not be the person that you would have chosen. It could also lead to increased delay and expenses in the administration of your estate.
Because death is such difficult topic to think about, it is common for people to avoid executing a Will. But by establishing an Estate Plan, you can ensure that the future needs of your loved ones are met, that your assets are distributed according to your wishes, and that your estate is not unnecessarily depleted through court costs and administration fees. A Will drafted by an experienced Elder Law or Estate Planning attorney will help ensure that you, not the State, control the distribution of your assets and the care and maintenance of those you love upon your death.