Most people know what a Last Will and Testament (“Will”) is and its basic purpose – to ensure that one’s hard-earned assets go to the intended beneficiaries when an individual passes away. However, Wills can be used for a lot more than simply dictating who gets a person’s treasured personal items. Here’s a list of some of the very valuable things a Will can do:
- List who gets what. The most common purpose for a Will is to name which individual, or group of individuals, shall receive a particular piece of property (personal or real property) belonging to a person when he or she passes away. Ironically, one of the most common causes of family disputes after someone passes away is who will get to keep the personal items that may not have great monetary value but which have great sentimental value.
- Divide remainder of estate: After distributing specific items to specific people, a Will usually divides the remaining value of the assets into shares for certain people or charities. A common misconception is that if you are married, all of your property automatically goes to your spouse. However, if you own any property in your individual name and you do not have a beneficiary named on the asset, under Illinois law your spouse will inherit half and your biological or adopted children will inherit the other half of your individual property unless you have a Will which states otherwise. The State of Illinois’ distribution plan can cause problems of many types, especially if the children of the deceased person are not also children of the surviving spouse.
- Name guardians for minor children. Typically, a Will is the document which states who should raise the minor children and manage the children’s financial estate if something happens to the parent(s). The Will also usually contains at least one alternate guardian in the event the first choice for guardian cannot serve.
- Name executors and trustees. A Will usually nominates the person or persons who will be the Executor of an Estate, which is the person who will carry out a deceased individual’s wishes as stated in the Will. Wills can also name the trustee of any trusts established in a Will. The trustee is the person who will be in charge of carrying out the instructions contained in the trusts established by the Will.
- Waive the legal requirement of a surety bond. Unless there is a valid Will which waives this legal requirement in the Illinois Probate Code, the Executor of the Estate must purchase a surety bond (similar to an insurance policy) to protect the Estate’s assets in the event the Executor mis-manages the assets. The premium for the surety bond is typically paid for by the Estate (from the deceased person’s assets) and can run between 1 and 2% per year of the value of the Estate assets. While no one can predict how much the surety bond will cost in advance of knowing an Estate’s value, it is not uncommon that hiring an attorney to prepare a well-written Will costs less (possibly by a significant amount) than the surety bond would cost the person’s Estate if they die without a valid Will and therefore are forced by law to purchase the bond.
- Establish a trust. In many cases, a person may not want their child or loved one to receive all of their inheritance at once. Or, a person may want their beneficiary to be able to use the property for a while, and then for it to pass on to someone else. In that situation, an individual may choose to leave their assets a trust established by their Will. A trust holds property on someone else’s behalf. In Wills, trusts can be established upon a parent’s death for minor children so that someone else can manage the children’s money until they reach a certain age when their parents believe they will be able to manage the funds. Trusts are also commonly used in second marriage situations – a person may want to allow their surviving spouse to have access to certain property while their spouse is still living, but wish that the property ultimately pass to their own children upon the death of the surviving spouse. Trusts can help accomplish that goal.
- List funeral wishes. Although this is also done in other documents too, a Will commonly states whether an individual wants to be buried or cremated, and where the body should be buried or the ashes should be spread. Sometimes, Wills also contain other information about funeral wishes, such as where the funeral should take place and even what readings might be recited.
While Wills can serve as powerful estate planning tools, they are only effective upon death and only if they are properly drafted to suit the specific desires of each individual. An estate planning attorney can review all your options with you and prepare a Will which ensures that your wishes will be honored.
