A will is a legal document that clearly outlines your wishes regarding the distribution of your assets and the care of your children after your death. This document has no effect until you pass on, and to be valid, it must comply with several requirements under state law.
Virtually everyone postpones writing a will, maybe because it seems like a vivid reminder of their mortality. This is probably why 6 in 10 U.S. citizens don’t have a will. Amidst the uncertainty of the year 2020, we all learned the ephemerality of life and the importance of living and doing things in the now. Unfortunately, not demographic is taking the Covid-19 lesson rather seriously.
Studies have shown the variations amongst different age groups, income classes, and races in drafting wills. Caring.com’s 2021 Wills and Estate Planning Study found that middle and older-aged adults between the ages of 35-64 are less likely to have a will now than they were just one year ago, while younger adults aged 18-34 are 16% more likely to have a will, thanks to Covid-19. This corresponded with the observations made by Patrick Hicks, head of Legal at Trust and Will, when he noted the demand for remote or online estate planning and the creation of wills had spiked during the COVID-19 pandemic.
Understandably, no one wants to think of death while they are still alive. However, it is never too early to write a will. While everyone should have a will irrespective of age, tax bracket, and accrued assets, it is especially important for high-net-worth individuals or those with a sticky family situation. It is never too early to write a will, but if you wait long enough, it might be too late.
Dying intestate (legal-speak for dying without a will) brings on a unique set of difficulties that will make life harder for your loved ones. We’ve seen it all—from the messy estate battles that rage between the relatives of the deceased to the plot twists brought by love children and secret lovers popping out of nowhere—unfortunately, the children of the deceased ending up in foster care or in the care of a less than capable family member.
There are lots of popular examples of the messiness of intestacy. For 30 years, the family of Jimi Hendrix fought over his estate simply because he didn’t draft a will. Bob Marley died without a will even after battling cancer for eight months, and his $30 million estate had dozens of claimants. Despite being the 16th President of the United States of America and a lawyer himself, Sir. Abraham Lincoln died intestate. When American singer-songwriter, producer, actor, and politician Sonny Bono died intestate after a skiing accident, his widow Mary Bono headed to court almost immediately to be appointed his estate’s administrator. His ex-wife Cher showed up on the scene as a claimant, and soon after, a “love child” surfaced.
Despite knowing these realities, a whopping 47% of the population still don’t see the need to get around to drafting a will. Sally Hurme, elder law attorney and author of “Checklist for Family Survivors: A Guide to Practical and Legal Matters When Someone You Love Dies,” says that as people age, they tend to realize the importance of an estate plan. She also stresses the importance of wills for younger people, especially if they have children, to ensure that they are cared for by those they elect as their guardians in the event of their death.
According to a recent survey, people who earn north of $80,000 yearly are more likely to have wills. In contrast, people who earn less than $40,000 annually are less likely to do so. Similarly, this study indicated that colored folks were less likely to have wills while white folks were more likely to have them. This could be linked to the income disparity, lack of access to resources, and general awareness about the will drafting process among this demographic. Fortunately, in the wake of the pandemic, there has been a marked increase in the population of Blacks and Hispanics preparing wills.
While procrastination is the most common reason why people don’t get to write wills, the belief that one doesn’t have enough assets to leave to anyone is a close second. Other reasons people cite for putting it off include believing it is too expensive or not knowing how to go about it. It is quite surprising that with almost 80% of people talk to a loved one about drafting a will, 44% get to the research stage, 32% write a basic plan/selected an estate plan, 24% make a plan for notifying loved ones, 16% consulted a lawyer, and only 12% filed the actual paperwork.
One noteworthy fact is that estate planning goes beyond a will. Estate planning embodies much more than specifying instructions on how your assets should be handled after your death. It can also include:
- A durable power of attorney: a document that appoints trusted individuals to make financial or legal decisions on your behalf if you are unable to make these instructions yourself
- A medical directive or healthcare proxy: a document that grants someone the authority to make medical decisions on your behalf if you are incapacitated
- Living or revocable trust: While you are alive, a revocable trust manages your assets and names those to receive them when you pass on. These trusts, in most cases, can also help with planning for incapacity.
- Personal property memorandum: Depending on the state in which you reside, this document allows you to gift tangible items not covered in the will to anyone.
With professional help, estate planning can legally help avoid large taxes. And for many who have philanthropic goals, estate planning can also ensure you sustain a philanthropic legacy like setting up a charitable trust or family foundation or even participating in a donor-advised fund to support the causes important to you when you have departed.
We understand that each family’s needs and situation differ. If you would like to sit down with a qualified attorney and have a more pointed guidance to creating or reviewing your estate plan, call us today on call at 1-800-461-4085.
Caring.com. (2021). 2021 Wills and Estate Planning Study.
Hurme, S. B. (2015). ABA/AARP Checklist for My Family: A Guide to My History, Financial Plans and Final Wishes (1st ed.). American Bar Association.
Patrick, H. (2021, February 10). Estate Planning, COVID-19 and Grandparents. ThinkAdvisor.
Walls, B. B. L. (2017, February 24). Haven’t Done A Will Yet? AARP.