Everybody should make plans for what happens to their possessions when they die, and that plan starts with a will. Typically, a will specifies who should receive specific cash legacies and treasured objects as well as the "residue," or what's left over after the debts and taxes are paid. Before you write a will, you need to decide who gets what. There are also some legal requirements to consider, to make sure your will stands up in a court of law.
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Decide Who Gets Specific Items
Start by listing your significant assets such as your property, stocks and bank accounts. Next, decide who gets what. Your will can make specific gifts of property such as cash, personal belongings and real estate; for example, you might leave a diamond ring to cousin Jessica and $10,000 to your nephew. Most people make bequests to friends and family but you can gift items to whoever you like — individuals, charities and organizations.
Name the Person Who Gets the Rest
Once you've made your specific bequests, it's time to think about who gets whatever property is left over. The "residue," as it's known, is likely the most valuable part of the estate and most people leave to their spouse, children or other close family members. You don't have to leave the residue to just one person. You can leave it to multiple people equally, or have it divided up into specific shares. Be careful if you are considering leaving your spouse or children out of your will. Most states give your spouse the right to claim one-third or one-half of your estate, no matter what the will provides.
Name Alternative Beneficiaries
Hopefully, all your beneficiaries will survive you to inherit their gifts, but it's worth thinking about what happens if they do not. You might want to name backup beneficiaries or have the owner of the residue receive the gift instead. Similarly, if your family is growing, you'll need to make it clear that "children" includes any child born to or adopted after the date of the will. That way, you don't have to change your will every time a new child is born.
Name an Executor
Every will must name an executor, who will be responsible for finding and managing your assets according to your instructions. Make sure the executor is willing to serve since it's a responsible and time-consuming job. As well as divvying up property to the named beneficiaries, the executor is responsible for paying your debts, settling tax bills, canceling contracts and leases, keeping the books and managing your bank account. Most times, the primary beneficiary will act as the executor. But if you can't think of anyone suitable, an attorney or lawyer will perform the service for a fee.
Choose a Guardian for Minor Children
If your children are minors, you'll need to designate an adult to take care of them in the unlikely event that both parents die before your children reach adulthood. If you forget to do this, the courts decide which family member gets to raise your children. If no one steps forward, your kids could wind up in foster care. Speak to your preferred caregiver first to make sure she's agreeable with the arrangements.
Choose Someone to Manage Your Children's Property
If you're leaving property to minor children, you'll need someone to manage it while the children are too young to manage it themselves. Otherwise, the court will appoint someone to serve as the children's "property guardian." This comes with a lot of red tape attached. The easiest way to do this is naming someone as custodian under the Uniform Transfers to Minors Act. For example, you might write, "I leave $50,000 to James Johnson as custodian for Oscar Wilson under the Texas Uniform Transfers to Minors Act." If you die when the child is under age according to your state's law, the custodian will step in to manage the property.
Sign Your Will in Front of Witnesses
After writing your will, you'll need to sign it in front of two adult witnesses who should add their signatures as well. The witnesses are there to attest to the fact you're mentally competent to make the will and were not coerced into signing anything you didn't want to. If you're using a "self-proving affidavit" with your will, your signature and the witness signatures must be notarized as well. Using a self-proving affidavit means the witnesses don't have to appear in a probate court to testify to the validity of your will, which makes things simpler after your death.