A will guarantees that your estate will be divided according to your personal wishes. Whether it be cash, houses, cars, jewelry, or any number of material items, a will distributes your assets to your beneficiaries, or the family members, friends, charitable organizations and pets that you name in your will. Assets that are not disclosed directly in your will should also be given assignment, whether it be set up for distribution by family members, placed in a trust, or auctioned for charity. Without a will in place, assets, including items of intrinsic or sentimental value, can be contested by members of the family whom you may not wish to have any piece of your estate.
Some assets cannot be included in the will because the beneficiary is named within the individual policies, such as life insurance and retirement plans. Other items that must be excluded from a will are:
- Assets that are jointly owned.
- Securities or brokerage accounts.
- Bank accounts or savings bonds that include a “transfer on death” (TOD) or “pay on death” (POD) designation.
- Community property with right to survivorship.
- Living trusts.
A will is also important for the appointment of guardianship over a child under the age of eighteen. If you fail to create a will, or someone is not named to take over the welfare of the child at the time of your death, the appointment of guardianship is left to the discretion of the courts. The role of guardian also includes ownership or responsibility over any assets bequeathed to the child.
It is good to remember that a will is specific to you. It should never be a joint venture between you and a spouse, family member or domestic partner. In that regard, it’s still a good idea to have a will even if the bulk of the estate is jointly owned, just in case the secondary owner (usually a spouse or domestic partner) dies before you, thus transferring sole ownership to you.