The Six-Step Guide to Will Preparation

Will preparation may seem complicated, but this 6-step process can help make sure your estate is handled the way you want.


woman-working-on-will-preparation

Most people don’t like to think about will preparation. It requires both that you contemplate your own mortality and that you do a deep dive into your current financial condition. Thankfully, it doesn’t have to be as challenging as you might fear.

With a little bit of planning, your will preparation may not quite be a breeze but it also won’t be a headache and it will leave your estate in better shape. Doing the work ahead of time will help ensure that your heirs and beneficiaries aren’t left guessing at your intentions.

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Six Steps for Will Preparation

Will Preparation Step 1: Write down a list of all your assets and debts.
This will include the contents of safe deposit boxes, family heirlooms (especially jewelry and antiques), art, furniture, collectibles, real estate, vehicles, business ownership/interests, health savings accounts, intellectual property, bank accounts, investment accounts, life insurance policies, retirement accounts, and other assets that you wish your heirs to inherit.

Will Preparation Step 2: Write down which of your heirs get what.
You may also want to write a “letter of instruction” to keep with your will. The letter should include a list of accounts and numbers, passwords, and burial instructions. By itself, please be aware that the letter of instruction may not be valid in some states; so, make sure you also include these items in your will. While you’re making your list, also consider a power of attorney or living will (medical directive), and who you would want to be responsible for financial and/or medical decisions should you become mentally or physically incapacitated (more on these later). And don’t forget about providing caretaking for your pets.

Will Preparation Step 3. Prepare and validate your will.
You don’t need an attorney to prepare your will; there are plenty of tools available on the internet, but I would strongly recommend an estate planner or attorney, just to make sure you close all the loopholes.

However, should you decide to go it alone, your will needs to be witnessed by two adults of “sound mind,” with whom you are well-acquainted. And to prevent trouble ahead, those witnesses should be “disinterested” people—those who have no financial or personal stake in your estate. If your attorney prepares your will, he should not serve as a witness. And lastly, your state may require that your will be notarized, which can help ease your heirs through the probate process (if you don’t manage to avoid that!)

Will Preparation Step 4. Choose an executor.
Choose wisely. You may want your best friend, but if you two are the same age, your best friend may not be around when you die. And your executor should be willing and able to administer your estate, even if it takes several years to be closed.

You can name pretty much whomever you desire—your spouse, an adult child, a trusted friend or relative, or your attorney. And you can name joint executors. But if your estate is large and/or complicated, consider a professional to manage its disbursement. And make sure your executor is empowered to pay your bills and deal with debt collectors and any related issues that may arise.

Will Preparation Step 5. Store your will in a safe, but accessible place.
People often first think of a bank safe deposit box, but if you die and your heirs do not have access to the box, it may take a court order to open it, which can delay the processing of your estate. A good, water- and fireproof safe can solve that problem. Make sure to give your executor and attorney a copy of your will and tell him where the original is located. Otherwise, trying to locate the original will can hold up the settling of your estate.

Will Preparation Step 6. Review your will every couple of years.
Life changes: beneficiaries die, people divorce, children are born, more assets are acquired. Any of those scenarios may prompt a change in your desired asset distribution. If that happens to you, you can either write a new will or add a ‘codicil’, witnessed by two people and notarized, outlining your change of heart.

  • No will—no control over the disbursement of your estate.
  • You can prepare a valid will yourself, but you must have it witnessed to decrease potential challenges.
  • Review your will—and revise, if necessary—every few years.
  • Oral wills are not widely recognized as valid.
  • While holographic wills (written, signed, but not witnessed) are recognized in some states, they often lead to challenges of their validity.
  • Life insurance proceeds, investment accounts, and jointly owned assets are generally excluded from wills.

*This article has been excerpted from a previously published edition of Financial Freedom Magazine.

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