Wills are an extremely beneficial estate planning tool. However, they do have some limitations. Below is a quick description of the most important things that wills can and cannot do for you.
What a Will CAN Do for You
- A will can help you avoid intestacy laws.
If you do not use a valid will to describe whom you would like to get your assets, anything you own at the time of your death will automatically go to your heirs as set out by New Jersey law. Many people want the freedom to name who should get their assets and dictate how much each person can receive. A will can help you accomplish this goal.
- A will allows you to give more to specific individuals.
Intestacy laws in New Jersey often divide up property equally among your heirs. Your will allows you to craft specific amounts that should go to each person. It also permits you to exclude people that you do not want to have any of your assets, even if they would have been included under intestate laws.
- A will lets you choose who should administer your estate.
If you do not have a will, the court will appoint someone to administer your estate for you. This person is often a family member, but it does not have to be. If you want to have someone special distribute your property, you need to set out that information in your will.
What a Will CAN’T Do for You
- A will cannot deal with property outside your estate.
Many people choose to use other estate planning tools in addition to a will, including life insurance, trusts, and property held in joint tenancy. Generally speaking, a will does not have any effect on that type of property. You will need to take additional steps to ensure that these other types of property are provided to the correct beneficiaries after you pass.
- A will cannot provide funeral or memorial instructions.
Your will is generally read after your funeral. That means that putting burial or funeral instructions in this document will not be helpful for your loved ones. You will need to use another method to convey this information to family and friends.
- A will does not reduce your estate taxes.
Only those estate planning tools that decrease the value of your estate will help you reduce your estate tax obligations. A will is not one of those devices. A will simply describes how your property should be distributed; it does not remove that asset from your estate to avoid taxes. You should use other methods if you want to reduce estate taxes.
Wills can be extremely useful if utilized properly. In many situations, however, it is just one of several estate planning tools that you should use as part of your estate plan. To learn more, contact the team at Matus Law Group at 1 (732) 281-0060 and schedule an appointment.