More than half of Americans do not have any kind of document dealing with the distribution of their assets upon death, such as a Last Will and Testament, or as it is commonly referred to, a Will.
A 2008 public opinion survey carried out by Harris Interactive found that 55 percent of adults polled do not have a Will, and therefore leave decisions about who gets what from an estate up to a court. A Will also can prevent misunderstandings and squabbling after the loss of a loved one.
It is not the kind of subject most people want to think about, however Connecticut Better Business Bureau President, Paulette Scarpetti says the drafting of a Will has many benefits.
“It is important for individuals to make their last wishes known in a Will in order to ensure they are carried out and to clearly direct what will happen to their assets and minor children upon death.”
Better Business Bureau offers the following guidance on the basic components of estate planning and advice on making the appropriate choice for different situations:
Will
At the very least, anyone with assets that they would like to pass on to specific individuals should draft a Will. The document also may establish the guardianship of children.
An estate plan can be as simple as drafting a Will yourself or as complex as setting up a trust and Living Will.
Living Trust
While a trust may sound like something only wealthy people need, it is actually a tool for anyone who’d like to be specific about how and when their assets are distributed, and unlike a Will, a Living Trust can help reduce inheritance taxes, and does not have to go through probate – a court that oversees payment of any debts and inheritances, a process that may take several months.
Living Will
A living will provides a way for an individual to communicate a desire for life-saving measures in case they are incapacitated. In addition to a living will, individuals can also assign medical power of attorney to someone they trust, to further ensure that their wishes are fulfilled.
For simple estates, many Web sites offer inexpensive or free do-it-yourself approaches to drawing up a Will. For more involved estates, however, it may be best to hire a lawyer. Consumers may research an estate planning company, or select a Better Business Bureau accredited professional from the accredited business directory at www.bbb.org.
After creating an estate plan, BBB recommends explaining its contents with family members and others it impacts. The documents should be updated if there is a change of address, or if there are any major financial changes, such as the acquisition or sale of any financial investments or a home or business. The estate plan must also be reviewed if there are any major life changes such as marriage, divorce or death.
Consumers can find more trustworthy information on managing personal finances at www.bbb.org.
