Everyone, no matter their age or net worth, should take the time to put a plan in place so that their wishes will take effect when they pass away. A properly executed Last Will and Testament is an essential part of the Estate Planning process. However, there are certain terms that should often be avoided in a Will document in order for your Estate Planning to be most effective.
- Life Insurance: If you choose to obtain a life insurance policy and you properly designate a legally acceptable beneficiary, then life insurance proceeds should automatically be paid to the properly named beneficiary. A Will document should not be necessary to effectuate the transfer of life insurance proceeds to a beneficiary. Any mention of the disposition of life insurance proceeds in a Will is unnecessary.
- Property: Property that is held in a Living Trust does not require transfer through the probate process. If property that is properly titled in a Living Trust is included as a gift to beneficiaries in a Will, such a gift is both unnecessary and confusing.
- IRA, 401(k) and/or Pension Benefits: These investments only require a properly named beneficiary. Similarly to property held in trust, retirement benefits are not required to be included in a Will document.
- Real Property: Real property held in a manner that transfers the property after death is not a probate asset; such property should not be included in the Will. In the State of Ohio, there are several methods by which to transfer deeds without requiring the assistance of the Probate Court, including Joint Tenancy with Rights of Survivorship and Transfer on Death Affidavits. On a related note, it is important for everyone, including married couples, to make sure that all of their real property is correctly deeded to avoid the probate process as part of their Estate Planning.
- Checking and Savings Accounts: Payable on death checking and savings accounts avoid the probate process and such accounts do not need to be included in your Will.
- Funeral Instructions: Instructions to the Funeral Home should be included in a separate document – not the Will. Often funeral arrangements are already made and the funeral is completed before a Will is accessed and reviewed. Moreover, in the event that a prepaid funeral contract exists, funeral instructions in a Will may be contradictory.
- Gift: One should avoid including gifts that require an heir to meet certain conditions before receiving a gift. There is a good chance that the condition placed on the gift may be deemed to be illegal either now or in the future. For example, a condition in a Will that requires an heir to abandon his or her religious or faith-based beliefs, that interferes with an heir’s financial rights, or that interferes with an heir’s right to marry will almost certainly not be binding. Moreover, it may be unclear if the heir has met the stated conditions when the time comes to determine whether or not to provide the gift. Furthermore, there is a strong chance that an heir will commence lengthy and expensive litigation against the estate if denied the conditional gift.
- Medical or Psychological Care: Avoid arranging for the care of another individual in your Will. Gifts that required Medical or Psychological assistance to complete are best transferred by a Trust, such as a Special Needs Trust.
- Pets or Animal Gifts: Avoid gifts in your Will to pets or animals. The best option to leave a gift to your pet is either by Trust or by leaving a gift to an individual that you trust will care for the pet.
- Specific Bequests: Limit or avoid entirely multiple specific bequests. Numerous specific bequests will increase the likelihood that the probate process will be costly, slow and arduous. In addition, if you leave specific bequests to a minor, another level of complication may occur in the probate process that could last until the minor becomes an adult.
