The Importance of Having a Will: Navigating Intestate Succession and the Benefits of Estate Planning
By Robert Steiner MS, M.Ed, JD
Without a will, your estate will be governed by intestate succession laws, which can lead to unintended and often undesirable outcomes
When it comes to planning for the future, having a will is a critical component of ensuring your wishes are honored after your passing. A will, formally known as a testamentary document, allows you to dictate how your assets should be distributed, who will serve as the executor of your estate, and who will take care of any minor children. .
Pitfalls of Intestate Succession
Intestate succession refers to the distribution of an individual's estate when they pass away without a valid will. The laws governing intestate succession vary by state, but they generally follow a set hierarchy that dictates who inherits your assets. The key pitfalls of intestate succession include:
1. Lack of Personal Control: Without a will, you forfeit your ability to decide how your assets are distributed. Instead, state laws will determine the allocation based on relationships, which may not align with your personal wishes.
2. Potential Family Disputes: Intestate succession can lead to conflicts among surviving family members, especially if there are differing opinions about how assets should be divided. This can result in prolonged legal battles, emotional stress, and strained relationships.
3. Unintended Beneficiaries: State laws may distribute your assets in a way that benefits relatives you may not wish to include. For example, assets may be split between your spouse and children, even if you intended to leave specific items to particular individuals.
4. Inadequate Provision for Non-Family Members: If you have friends, charities, or other organizations you wish to benefit, intestate succession laws will not accommodate these preferences. Only legally recognized heirs will receive a share of your estate.
5. Court Intervention: Intestate estates often require court intervention to appoint an administrator to handle the distribution process. This can be time-consuming, costly, and impersonal compared to having a designated executor manage your affairs according to your will.
Assets Passing Outside of Probate
While a will covers the distribution of assets that go through probate, certain assets pass directly to beneficiaries and are not subject to the probate process. These assets typically include those held by contract or with designated beneficiaries. Here are some examples:
- Life Insurance Policies: Proceeds are paid directly to the named beneficiaries, bypassing probate.
- Retirement Accounts: Accounts such as 401(k)s and IRAs pass directly to the designated beneficiaries listed on the account.
- Joint Tenancy Property: Property held in joint tenancy with rights of survivorship automatically transfers to the surviving joint tenant.
- Payable-on-Death (POD) Accounts: Bank accounts with a designated POD beneficiary transfer directly upon the account holder's death.
- Transfer-on-Death (TOD) Securities: Stocks and bonds held in TOD accounts are transferred directly to the named beneficiaries.
- Trust Assets: Assets placed in a revocable or irrevocable trust are distributed according to the terms of the trust and bypass probate.
Conclusion
Creating a Will is essential to ensure that your wishes are respected and to minimize the potential pitfalls of intestate succession. By outlining how your assets should be managed and distributed, you can prevent disputes, avoid unintended outcomes, and provide for loved ones and organizations important to you. Additionally, understanding which assets pass outside of probate helps in comprehensive estate planning, ensuring a smoother transition of your estate in accordance with your desires. Consulting with an estate planning attorney can further help tailor your will and overall plan to best meet your needs and preferences.
For further information or to discuss any legal matters, please contact Attorney Robert Steiner at (205) 826-4421 or via email at robert@steinerfirm.com. Whether you have questions about this article or need personalized legal advice, he is available to assist you.
