APRIL 14, 1997 VOLUME 4, NUMBER 41
Most people understand the basic principles behind making out their Will. Experts who deal with estate planning, however, are frequently surprised at how common and how persistent certain myths about Wills and probate can be. Some of the more prevalent misconceptions:
- The Myth: If you don’t make out a Will, the government will take your money.
The truth: If you don’t go to the trouble of saying (in your Will) who you want your estate to go to after your death, and who should be in charge of administering it, the government will make some assumptions about what you intended. In fact, those assumptions are usually right. For most people without Wills, the entire estate will pass to a surviving spouse. If there is no surviving spouse, the estate will go to children in equal shares. The person given power to administer the estate in the absence of a Will is usually the spouse or one of the children of the decedent.
One big problem for some people: under Arizona law, if you have children who are not children of your surviving spouse, the default provision will split your estate between your spouse and children. The moral is obvious: Wills are particularly important for those who are in second marriages.
- The Myth: If you move to a new state, you need to make a new Will.
The truth: Every state will honor Wills executed in another state (usually, even in another country). However, when you move you usually change your life in other ways at the same time, and it is appropriate to have your estate plan reviewed. In the meantime, your Will remains valid.
- The Myth: If you write a Will, you won’t have to go through Probate.
The truth: Probate is the court process by which your wishes are determined. The purpose of making a Will is to provide the probate court details of your wishes. While a Will makes it easier to determine those wishes, it does not avoid the process at all. In fact, the probate procedure will not even be made less expensive or faster in most cases.
- The Myth: If you want to disinherit someone, you need to leave them one dollar in your Will.
The truth: Nothing requires that your Will leave any minimum amount to any relatives. The most efficient way to disinherit a child or spouse is to identify them (so no one can say you were so confused you forgot you had children, for example) and indicate that you are not leaving them anything. Leaving a dollar to a disinherited child puts your personal representative (executor) in the difficult position of having to secure a receipt for $1.00, and of having to account to the child who you intended to leave out.
There are laws in most states which make it impossible to completely disinherit spouses and minor children. In Arizona, for example, the surviving spouse is entitled to receive a minimum amount (usually $37,000) from the decedent’s estate regardless of what the Will provides. But leaving a $1.00 bequest to a surviving spouse doesn’t change that principle, and the same entitlements do not apply to adult children in most states.
- The Myth: Wills are easily contested, so it is difficult to ensure that your wishes will be carried out.
The truth: A tiny fraction of Wills are ever contested. In fact, most Wills never even get submitted to the probate court (since so many people use joint tenancy, beneficiary designations and trusts to avoid the probate process). Only those who would inherit under an old Will, or under the law providing for those who make no Will, would have any incentive to contest a Will in any event.
In a future Elder Law Issues, we will deal with common misconceptions about Living Trusts.