 Personal Finance PowerPoint Presentation, simple will. Prepare to get financially fit by practicing personal finance. Support accounting instruction by clicking the link below, giving you a free month membership to all of the content on our website, broken out by category, further broken out by course, each course then organized in a logical, reasonable fashion, making it much more easy to find what you need then can be done on a YouTube page. We also include added resources such as Excel practice problems, PDF files and more like QuickBooks backup files when applicable. So once again, click the link below for a free month membership to our website and all the content on it. Most of this information comes from Investopedia, how to write a simple will which you could find online. Take a look at the references, resources continue your research from there. This by Amy Fontenier updated April 29, 2022. In prior presentations, we looked at retirement planning, then moved to estate planning. Now looking at a specific component of estate planning, the simple will, how to write a simple will. So a simple will also called a basic will lays out what you would like to happen to your assets after you die. So if we look at the timeframe that we went through in overview in a prior presentation of the estate planning process, we are before death here planning what we want to do with our assets in the will, laying that out in the will because at the point of death, of course we won't be able to manage our assets. We would like to have those assets allocated in accordance with our wishes and we would like to make it as easy as possible for our loved ones after the point of death. If there's no kind of organization you can imagine after the point of death, it could cause some chaos to determine what assets are there and then what to do or how to be allocating those assets. So if you're ever worried about who will get your wedding ring, inherit your house or take care of your cat after you die, it might be time to create a will or update an existing will that's out of date. So clearly we want to put our wishes down in the will. If it's been a while since we've looked at the will, then we might want to update it as circumstances, situation assets have changed. What is a simple will? A simple will says what you want to happen to your stuff when you die. Your stuff might include everything from your great-grandmother's cuckoo clock to your adolescent journals, to your car, house, and bank accounts. You might be surprised to learn that your pets are considered property so you'll need to leave them to someone to ensure their care. As its name implies, a simple will is best for people with simple situations. You may need a trust and perhaps a permanent life insurance policy if you have a lot of assets, have assets in multiple states, have gotten divorced or remarried, have stepchildren or own a business to name a few examples. So in other words, there's some questions in terms of how basic the needs are at the point of death. So obviously a simple will, as implied, is gonna be on the simple side of things, assigning what you want to be done at the point of death. As people's assets go up, for example, or as we have some of these other complexities, then you might need some other things going on. For example, estate planning, if assets are large enough to be subject to estate taxes, can be an important factor, something worth getting more complex strategies for that we might talk about in future presentation. So what makes a simple will valid? Besides not wanting to think about death and not knowing where to start, fear of making a will that won't hold up after they're gone might be one of the biggest reasons why people put off creating their last will and testament. So obviously creating something about what's gonna happen when you die is hard enough, and then creating like a legal document that you're hoping is gonna hold up can be a little intimidating or quite intimidating as well. One of the most important things to know is that the requirements to make a simple will valid depend on the state where you reside. So note we have some things that fall under the federal law, some things that fall under the state law, so a lot of this stuff is gonna fall under state law, so it could be slightly different from place to place depending on where you are at, general concept, you would think of course being somewhat similar with regards to a will in general. Generally, you must be at least 18 years old, create the will when you are of sound mind and not under duress, so people can't be threatening you, gun to your head or something. Put your will in writing, so we wanna have the will typically in writing and sign it. So you will typically need two or three adults to watch you sign your will, then sign it themselves as witnesses. So in some cases, you may need to have a notary public as a witness, so you might have to get a notary to verify the signature process and so on. Information to include in a simple will. A simple will should identify you by your full name and address, be dated and have your signature. So clearly you need those things in there to identify it's your will. It should state that you understand the document you're signing and that no one is pressuring you to sign it. That would be if they were, that you were under duress when you signed it and that would make it invalid. So it should also state that any previous wills you've created are invalid and superseded by this new one. So as things change over time, then the question could be, well, if you have multiple documents that say conflicting things, which is gonna be the most valid, if you're making the latest and greatest will, you wanna make sure that that will is the one that's gonna be used, that it's gonna be superseding the prior will. So you'll name a personal representative, often called an executor. That's gonna be the person that's gonna be executing the will following the will's instructions to the best that they can at the point of death to carry out your wishes. You'll also name an alternative in case your first choice can't serve. If you have a minor children, you'll name who you would want to become their legal guardians and include alternatives there as well. Next, you'll name beneficiaries and alternates to receive specific assets. Identify them by their full name, current address and relationship to you, then describe in detail what you're leaving to them. You may also want to include instructions authorizing your personal representative to take certain financial actions to settle your estate, such as paying debts, paying taxes, hiring an attorney or accountant to help and selling investments. So clearly this will be dependent on your personal financial situations, right? So we're gonna have at the point of death, you might have some assets that have accumulated, you might still have some liabilities. And then clearly you would think what needs to happen is the liabilities are generally gonna be needed to be paid off, you would think. And then the assets would need to be distributed. And then there's questions in terms of how those assets are gonna be distributed. You can try to list out those assets. You might have a big assets like a home, which could make it a little bit more difficult to say pay off the liabilities with the home. You might have to actually sell the home or something like that. So it depends on the situation. Making things official. Once you've drafted your will, it's time to make it official. Sign it in front or whatever witness your state requires. That might be two or three disinterested parties who won't inherit anything from you or a notary public or both. So you can see why some of these regulations might be there because if someone's gonna be inheriting significant stuff and they're the one that watched you sign it, then that doesn't look good holding up in court because they have a motive to be deceptive about it. A notary public might be necessary depending on the state. Make copies of your will and store the original in a secure place that your executor will be able to access when needed. Tell them where it's stored. So clearly at the point of death, you wanna make sure that your executor can access the latest and greatest will in order for them to be able to put that in place. Finally, make sure to revisit your will every few years or after a major life change. Clearly things happen as time passes, you might have different assets and so on and so you wanna change your will or update it when necessary. If it no longer reflects your wishes, find out the best way to update it which might mean redoing it. Do I need a will? Yes, for your own peace of mind and to make life easier for the loved ones who you leave behind you should have a will. It becomes extra important if you have dependence. So obviously if you don't have a lot of assets, the will might not be as big of a problem but everybody has something that they need to manage generally after the point of death and you wanna be able to list that out, you wanna be able to allocate your assets as best you can. Clearly the more complex your situation, usually more complexity happens possibly with the family structure, marital structure, divorces and that kind of stuff but also children dependence but also with income. As income goes up, you've got more assets that need to be allocated. If you don't list how that's gonna happen, you can imagine just chaos, more chaos happening after the point of death when you're trying to be nice to make things as easy as possible. So if you don't have dependence or significant assets however, you might not need a will. Set up these beneficiaries designations on your accounts So if you don't have a will, then whatever assets you have, you might be able to set up on your accounts who the beneficiaries are at the point of death and make that kind of like the automatic process. How much does a simple will cost? Nothing, if it's a simple will that you type up yourself, create with a free online template and don't need notarized. So you could look up online templates for setting up the will and that of course would be a free process for it if you get the template for free and you can create the will but of course you still have to deal with the signing process which could include some notarization of it. So if you're afraid that you'll make a mistake that would make your will unclear or invalid or if you just feel confused or overwhelmed by the process which is totally normal, consider upgrading to a paid option. Plenty of online services will walk you through the creating a will specific to your state and your circumstances. Some can even help you identify whether a simple will is the best document for your needs. The cost generally ranges from $50 to $200. As for getting your will notarized, your bank may offer free notary services. You can also find inexpensive notaries at UPS stores as well as mobile notaries who will come to your house. So those are becoming a bit more common I think in the whole pandemic time. So they won't review your will or tell you if it will hold up in court. Their only job is to verify your identity, witness your signature and record the transaction in their notary book. The cost of hiring an attorney to prepare your will generally can range anywhere from $300 to $1,200 depending on the going rate in your area, the attorney's experience and the complexity of your situation. Many people are intimidated by the thought of hiring an attorney. Concerns include not knowing how to find one who you can trust and assuring you won't be able to afford their fee. The State Bar Association is a good place to start your search. A small but interesting study of wills in Alameda and San Francisco counties by the University of California Davis Law Professor David Horton found that lawyer drafted wills may be less likely to be contested in court, homemade and holographic wills are more likely to be contested. So obviously you would think that a lawyer would be able to structure the will in such a way that it would be more legally clear and tight but again, you gotta weigh the pros and cons. What happens if I die without a will? So what if you don't have a will? What's gonna happen? A little bit of chaos, most likely it depends on how much assets you have and so on and so forth because obviously they have to somehow sort out what to do with the assets and liabilities that you are managing. So if you die without a will, trust or other legal documents stating what should happen to your assets when you die, you are said to have died in testate and your state's law will determine how the probate court distributes your assets. So we talked about the process in general in a prior presentation. Basically you set up a will, the will in probates gonna determine the validity of it, an executor is assigned and so on and so forth. Obviously if you don't have a will, then you gotta go through that process but they don't have the will. So even if you do die with a valid will, your state's probate court will oversee the distribution of your assets. This process can be relatively simple or take months depending on your state and how complex your situation is. The court charges a probate fee for its service. What's the bottom line? Don't be afraid to tackle your will. Pick a day, put it on your calendar and get it done. It won't be as bad as you think.