A recent survey found that “40% of Americans don’t think they have enough assets to create a will, and even fewer have an estate plan.” These numbers are alarming considering that if you neglect to tackle your will and estate planning, it only means that you are potentially leaving your loved ones with the burden of managing an estate that may now be tied up in court for years to come and may not be distributed in line with your wishes.

If you die without a will, it is called dying intestate, and it creates a situation where the court will make all your decisions for you based on your state of residency. You’ve relinquished the ability to determine how your children will be cared for and how your assets will be distributed. On the other hand, perhaps you have a will, but not an estate plan. Maybe you believe that estate planning is only for the wealthy. You’ve worked hard your whole life so that you can leave behind assets for your loved ones; only, if you don’t have an estate plan, those assets can be put through a lengthy and expensive probate process. That’s not likely how you intended things to work out, especially if you spelled out your wishes in a will.

So, what do you do now? It can be helpful to understand the differences between wills and estate plans, and also, how they work together.


What goes in a will that is used in estate planning?

A last will and testament is a legal document that can stand alone, but it should be part of a comprehensive estate plan. You can use your will to provide specific instructions about how you want your property and assets to be distributed.  It may include recommendations for a guardian for minor children and even provide for surviving pets. A will does not cover everything, but here are the components that should be included:

  • Personal information – As the testator (person who is writing the will), you must include basic information like your name, address, and date of birth. You may also list the names of your family and their relationship to you.
  • Testamentary intent – This is a statement that is required for your will to be valid. This is written in proper legal language to verify that the document you’re writing is a will.
  • Assets and beneficiaries – What do you have and who are you leaving it to? You can leave your assets to whom you choose regardless of whether that is a family member or friend. Your beneficiaries can even be a charity, business, or trust, but it’s a good idea to also name contingent beneficiaries should the primary beneficiaries not be able to accept.
  • Name an executor – This is your personal representative who will carry out your wishes that are in the will.
  • Name a guardian – A guardian is someone who is granted the legal right to make decisions on behalf of someone else. In a will, a guardian may be appointed to make personal, financial, and medical decisions on behalf of your minor children or adult children with disabilities. A guardian may also be named for a senior parent you are caring for.
  • Signatures – Most states require that when a will is drafted, in addition to your own signature, two witnesses must also sign to confirm your identity and that you were of sound mind when executing the document.


What is an estate plan?

An estate plan is a tool that helps you with end-of-life planning and may include documents that ensure your wishes are respected regarding your medical care if you are unable to communicate with caregivers. The best estate planning advisors will analyze your personal situation and make recommendations as to the most appropriate items to include, but the following should be on your estate planning checklist:


Do I need both a will and an estate plan?

A will and an estate plan are not the same thing. A will is one of the items in an estate plan. A will has clearly defined terms that specify how you want your assets to be distributed to your heirs. By having a will, you can make sure that your wishes are respected. If you were to die intestate, or without a will, the probate court will divide your assets among your next of kin according to your state’s laws, but that might not be what you want. For example, say you have a friend who is so close that they feel more like a brother while your only remaining blood relative is a cousin you do not speak to.  If the court has to distribute your assets, your cousin could wind up getting everything while your friend gets nothing.  However, if you draft a will, you can make sure that you dictate how your assets will be transferred.

An estate plan contains your will. The use of trusts in your estate planning may provide for a less stressful transfer of your assets to your heirs. Trusts can help to avoid the probate process, control distribution after your death and may minimize taxes. Estate planning may be used in end-of-life planning, but it also helps to protect you in situations when you may become injured or ill to the point you are unable to make decisions about your own care. You can create a financial power of attorney to designate someone to act on your behalf in financial matters, and you can create advanced directives that express your wishes for end-of-life care and give a designee the authority to make medical decisions for you if you are unable. Additionally, you can specify beneficiaries on things like life insurance policies and retirement accounts.


It can be overwhelming to face our own mortality. Maybe this is one of the reasons that so many people procrastinate, or simply avoid, estate planning.  Yet, it doesn’t have to be a painful process. Your financial advisor can help you with estate planning services. They can explain all of your options and they can guide you through creating an estate plan that is best suited to your personal circumstances and meets your family’s needs.  Please contact us today if we may be of any help.