Do I Really Need A Will?

Posted by Winifred "Wini" Cannon | Oct 07, 2020 | 0 Comments

Why should you have a will? Do you still need to have a will if you don't own any property, don't have any bank accounts, or maybe you just have one piece of property and you're married and your spouse owns one-half interest, and you think that, okay, the other half will go to your spouse on your demise? Well, that may be true and it may not be true. It depends on the laws of intestate succession in the state where you reside and where the property is located.

 

An Example 

Say Charlie is married to Sue and they own a family residence together. He has some bank accounts. Both of them he put Sue's name on, but maybe one or two he forgot to put her name on as a beneficiary. And then say there were some deposits or some other unclaimed monies that were held by the Comptroller of the Treasury. So when Charlie dies, the laws of intestate succession will dictate how your property is distributed.

A lot of times, people don't pay attention to the laws of intestate succession until the property has passed down through several generations. What I mean by that is this. Charlie and Sue own this property as husband and wife in Texas, and they had one child together, but say Charlie had children from a previous marriage. So what would happen in that situation is Charlie has one-half interest in the property. However, when he dies, his wife gets a life estate in the property and the children from the previous marriage, say if there are two children, they would both get one-half interest. Three children, one-third. So if Charlie had written a will and he said that his one-half interest would have gone to his wife, then there wouldn't be any claim of right by the children from the previous marriage. But because he did not write a will, then now this all becomes an issue.

Say on the other hand, if Charlie and Sue were married with the property, the family residence they acquired during their marriage, and they have one child together. Upon Charle's death, his whole one-half interest goes to his wife, and the children basically don't share in that community property. Now, if it's separate property, property that he got by an inheritance, or property that he owned before he got married, and they were careful not to co-mingle any of the marital funds in that property, then there would be a different distribution of that asset.

 

Having a Will Is a Smart Move 

So it's very important to know that it's just a wise move to basically have a will so that you don't come up against the idiosyncrasies in the law if there's not a straight transfer done in a will, because it depends. It depends on whether there were children from a prior marriage. It depends on whether the children that you have are both you and your spouse's. And then it gets even further complicated if the children have died but they leave children. And then we're talking about representation.

So I don't want to confuse you guys. I just want to hone in on the fact that it is important to have a will, because everybody has something. You may have property that you know about right now, and you just think that, okay, it's husband and wife, my spouse is going to get the whole thing, but then what happens when there are other blended family situations? So to avoid this, get your will. Intestate succession may not give you the results that you wanted if you had written a will.

 

The Importance of Inventory

Now, when you write a will, it's important to inventory. A preliminary concern, when you plan on having a will written, it is important to inventory your assets. We'll be glad to give you a free form for you to fill out so that you can characterize your assets and property. Your property is either going to be real property, personal property, or intellectual property. Real property is assets that are attached to land in some form or the other. Personal property is not real property. It's stuff like your furniture, your artwork, your jewelry and your bank accounts. And your intellectual property would be copyrights, patents, and trademarks. So it's important to characterize your assets, because some of these assets are what we call probate assets, and some are not. Those that are not being controlled by contract.

 

Beneficiary Cards and Designated Beneficiaries

So if you have a bank account, there should be a beneficiary card that you can designate your beneficiary. The same with life insurance. The same with the retirement accounts. You should be able to designate your beneficiary so that upon death, the person you've designated, all they have to do is show a death certificate. If you fail to designate a beneficiary on those kinds of contractual arrangements, then your loved one will have to go to court to start a probate proceeding. In Texas, they would have to have a determination of heirship and an application for independent administration. This could all be avoided. To go to court ties up time and money. So it's always a good idea to have that inventory sheet and to check on every bank account at least once a year or whatever to make sure that your beneficiary cards are on file.

Do you know, this year alone, I've had so many requests to go in to open up probate proceedings to have heirs determined so that letters testamentary could be issued. These are administrative letters so that the person would have the authority to go in and get the 401k proceeds, to get the insurance proceeds, to get the 401k. So it's just a good idea to basically plan, because what we're about here, what I'm about as an attorney is I'm trying to plan for the known and the unexpected things so that your wishes will be accomplished, but there'll be a smooth transition in making a distribution.

 

Free Inventory Checklist

So thank you, and just send me a email at [email protected], and I'll be glad to send you the inventory checklist so that you can know what you have, so that you could make those decisions to either write a will or to upgrade the ones that you have, and to make sure that all non-probate assets such as insurance policies and bank accounts, the beneficiary cards are updated.

About the Author

Winifred "Wini" Cannon

Winifred “Wini” Cannon knows how business owners may be impacted when retirement, incapacity, or death occurs without a good plan in place. One example that is very common is in the instance where one partner dies leaving the other trying to stay in business complicated by the...

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