Many people believe, for various reasons, that they do not need a will. But how valid are these reasons? Let’s take a look at some common reasons:
Your estate is too small.
- Provide for the distribution of your assets.Without a will or other estate planning documents, your estate will be distributed in accordance with state law, which may or may not coincide with your desires.
- Name guardians for your minor children. Without a will, the courts decide who will raise children when both parents die.
- Select an executor for your estate. The executor assembles and values your assets; files income, estate, and inheritance tax returns; distributes assets; and accounts for all transactions. You will typically be in a better position than the courts, based on family relationships and individual qualifications, to decide who should be named executor of your estate.
All of your property is jointly owned. When one owner dies, jointly-owned property passes directly to the joint owner, regardless of provisions in a will. Also, the unlimited marital deduction allows you to leave any amount of your estate to your spouse without paying estate taxes. Thus, many married couples use joint property ownership as their sole estate planning technique. However, if your joint taxable estate exceeds the lifetime gift and estate tax exclusion, your estate may save estate taxes by distributing some assets to other heirs.
A living trust will distribute your assets. Only assets that have actually been conveyed to the living trust are controlled by the trust document. Typically, a pour over will is also needed, which places any assets not held by the trust at your death in the trust.
You expect your estate to grow significantly in the future. Some feel it is premature to plan their estate because they expect changes in the future. However, a will can be changed. In fact, you should periodically review your entire estate plan to see if changes in your personal situation, preferences, or tax laws require changes to your plan.