What is in a Typical Will?
A will most likely will include the following provisions:
- Your name (the TESTATOR)
- The name of your spouse and the date of your marriage, if any
- The name of your children (and how you wish any foster and stepchildren to be treated), if any
- A statement revoking any wills you may have previously made
- Your nomination of a personal representative to administer the estate and usually at least one alternate.
- A list of powers that you want your personal representative to have (these are often enumerated in your state’s statutes
- A list of any special gifts
- Instructions for distributing the remainder of your estate after your debts, taxes, and expenses incurred in administering your estate have been paid
- A WAIVER of any surety bond requirements
Your will may not cover everything that you consider “your property.” The following types of property are examples of assets that may pass directly to a BENEFICIARY you have named in a separate document:
- PENSION plan assets
- 401(k) plan assets
- life insurance
- property held through a “trust”
These assets would usually pass to beneficiaries you have previously named in documents under the supervision of the manager of the pension plan, the company sponsoring the 401(k), life insurance companies, annuities, and in a trust instrument. However, if you name “my estate” the beneficiary of these kinds of assets, then you will control who receives the property and benefits. Be aware that by doing this your eventual beneficiaries may experience some significant delays and/or some important tax disadvantages.
Your will should be prepared and properly executed (signed by you and a certain number of competent witnesses) while you still have legal capacity. Thus, if you want a will, you should have one prepared and sign it according to the applicable state law while you have full control over your mental functions. If you wait until you suffer an accident or an illness, it could be too late.
The Personal Representative
When you die, your personal representative (also known as an administrator or executor) will gather and inventory all of your property at the time of your death. Most states require the personal representative to post a surety bond covering his/her actions, although you can explicitly waive this requirement in your will. The personal representative will also determine your outstanding debts, pay your legitimate debts, and distribute the remaining property according to the instructions in your will. Your personal representative will be appointed in a PROBATE proceeding. The personal representative must usher your property through the probate process, subject to your state’s probate rules and procedures. In many states, the court maintains tight control over the activities of the personal representative. For example, the personal representative must obtain the court’s permission to sell, distribute, or otherwise take action with respect to property in your estate.
It is important to choose someone who you think will be competent and trustworthy to serve as your personal representative. The personal representative will have access to all of your property and the authority to conduct certain business on your behalf. To the extent that you can, it is a good idea to choose a person with some business experience, intelligence, and high integrity. Your will should name the person you wish to nominate as your personal representative. You will probably also name one or more alternates to serve in the event that your first choice for personal representative is unwilling or unable to serve. Because you cannot speak in your own behalf, your will acts as your voice to inform the probate court about who you think will be best suited to this job.