Hitting the Right Notes on Wills and Trusts this Year

Hitting the Right Notes on Wills and Trusts this Year

If you feel that planning for a graceful exit from life is the most depressing thing you could find to think about, you have to realize at some point that it is a no more unpleasant a thought, leaving to meet your maker without having left your assets to anyone in particular. And taking on the risk that it may all go to no one you consider important, or close to you. Any time that you look closely at your financial situation to plan for the future, this is certainly a possibility you'll have to consider at least a little bit - how do you see your assets distributed among your legal heirs, should something catastrophic happen.

At one time, not too far in the past, if you made out your will, it was just cast iron - no one could dispute anything if those were your dying wishes. However when the legal whole estate tax system expired recently, it took the security and sanctity of the will with it. But that is getting a little ahead of ourselves. Almost no American actually has a proper will in place.Worrying about losing your rights to a secure will can be a little premature if you've never even had one. There really is no reason to go intestate; there are even online will facilitation services that can make the process pain-free. If you still find it hard to believe in wills and trusts, here's a little incentive. People seem to think that if there is not a whole lot they have by way of assets when they die, everything will just automatically be made over to their immediate heirs, their next of kin, without much ado. Nothing could be farther from the truth, as ado there will be.

What is worse, the ado will be on your coin. The government will bring in a conservator, lawyers and other clerical staff, all of whom will be paid out of your estate. And they will remain on your payroll until they find a satisfactory solution to the question of what to do with your money. The whole estate tax mix-up exists only in the year 2010. The estate tax will be right back next year; that makes this year an especially important one to keep your wills and trusts up-to-date in great shape. If you have a good bit of money and property, if your wills and trusts are outdated enough to not take the estate tax situation this year into account, you'd be inadvertently leaving a lot of your money to people you don't care that much about, or leaving too little to the ones you do care about.

While you're at it, have you thought about the beneficiary designation form? That's what decides who gets your insurance and retirement money after you. Wills and trusts have nothing to do with this. If you took out an insurance policy 20 years ago before you met your wife, and you nominated your sister as the beneficiary in case you died and then forgot all about it, 20 years later, your wife and children won't get a cent. Because your sister, whom you put down as beneficiary all those years ago will be the only one who counts on paper. It doesn't matter what you say on your will about how important your wife and children are. It's important to keep track of everything, and keep everything up to date.

Of course in the end, wills and trusts have to be placed somewhere your family can find them. In addition to the will, it would be a good idea to put down on a balance sheet, everything that you own and everything you owe. And on top of that, you could leave a letter of intent for those you leave behind. Even if they can't find the will, at least they will know what you intended. Even if that isn't really valid in a court of law.