There’s a lot to think about when drafting your will and while you can prepare a valid will yourself, if you are very wealthy or have complicated assets it really is in your best interests to consult a specialist.
In a simple will you can specify who will receive your assets and name a guardian for any minor children. A testamentary trust will allow you to place assets into a trust for your beneficiaries and name a trustee to handle the trust. A joint will is a single will signed by two people, usually a married couple, leaving all their assets to each other. A living will has nothing to do with the distribution of your assets. Rather it allows you to choose what medical treatments you want to have if you become incapacitated and allows you to name someone to make decisions on your behalf. You can have more than one type of will at the same time. For the purposes of this article, we will look at simple wills.
- Ensure your will is valid:
- It must be in writing
- It must be dated and signed by the person who made out the will
- It must be witnessed by two adults and they may not be beneficiaries
- You need to be of sound mind when signing your will. What this basically means is that you know what a will is, who your beneficiaries are and their relationship to you, what you own and how you want to distribute your assets.
- Keep the original signed document in a safe place that is both waterproof and fireproof and have someone you trust have access to it. Your lawyer can also keep a signed copy.
- It’s advisable that you draw up a list of all important documents (and include copies thereof) that are related to your estate, such as birth, death, marriage and divorce certificates; deeds and mortgages; bank account details, investment portfolio and insurance policy account numbers; as well as contact details for your banker, lawyer, accountant, financial advisor etc. Ensure your executor or someone you trust knows where this information is located. Keep it separate to your will.
Your will should include:
- An inventory of your assets
- Distribution of your assets andthe beneficiaries
- Distribution of specific items such as art, jewellery, sportsequipment etc. that you may want to pass on
- Details of guardians forminor children
- Instructions for handling your digital legacy (this is your online information such as social media accounts, blogs and websites, email accounts)
- Directions for maintenance of your property
- Who will care for your pets
- Organ donation
- Contributions to charities
- Funeral and burial arrangements
- Instructions regarding payments of debt
While it’s common for beneficiaries to be family – spouses, children or extended family, things happen, and circumstances can change unexpectedly. If you and your spouse happen to die at the same time, you would have needed to specify in writing who is ‘next in line’. You can also only give away what you own, so if you share a property with your spouse or business partner, for example, you can only give away your portion. It’s not necessary to include assets such as annuities, life insurance, and retirement policies in your will as you would have appointed beneficiaries when you set them up. Make sure the beneficiary information on your policies is up to date.
While a spouse or other parent would generally get custody of minor children, you should specify in writing who will look after the children in the event the other parent is unfit or if both parents die. If you don’t specify guardians, the court will make a decision that may not necessarily be in the child’s best interests. This is a very important decision – you need to consider the guardian’s ability to care for your child/ren, their relationship with the child/ren, their moral fitness and, if you are not able to allocate financial support, their financial health. You can set up a testamentary trust for your children in your will and the trustees can manage the money they inherit on their behalf until they are allowed to access the funds. Discuss your decision with potential guardians before naming them in your will.
Appointing an executor
Have someone you trust who knows where your will is kept, who the executors of your estate are and has access to online passwords and documents relating to bank accounts and other documents of importance. You can appoint a family member as an executor, but it could be stressful for them and the administration of a deceased estate can be complicated. It’s therefore recommended that you appoint a professional executor to assist the family – someone skilled in financial matters and who is trustworthy and organised. If your assets are complicated, consider working with a lawyer who specialises in wills and estate planning. They can also advise you on an offshore will if you have assets in another country.
The importance of having a will cannot be stressed enough. “We often see cases of people having passed away without their affairs in order. This results in unnecessary stress for the family as well as a long and drawn-out process which can run for many years and be very costly,” says Anthony Palmer, Group Commercial Director at Carrick. “At Carrick Consult we ensure clients understand the process as well as the costs and parties to be contacted at time of death. We keep updated records of everything which drastically reduces the time involved to wind up an estate. This often leads to different decisions being made and clients become far more comfortable that their planning is in order.”