Writing a Will
Most people intend to write a will eventually, and you may have already thought about which loved one you plan to pass this or that asset to someday. If you have not written your will yet, you are not alone. A recent study published by Forbes found that of those over the age of 55, more than half have yet to create this essential estate planning document.
If you do not have a will upon your death, many questions will arise about your personal property and where it should go after you pass away. But perhaps you have delayed its creation because you are unsure of what you should or should not include in this document. Although you can include most of your belongings, finances and real estate in your will, there are several types of property that you should not add to this document.
Money from a retirement plan
This includes money from a 401(k), pension or IRA. Since these plans typically include the opportunity for you to note your desired beneficiary, you do not have to add these funds to your will.
Property owned with a joint tenant
By law, joint tenancy property gives your joint tenant the right to this property upon your death. Regardless of what your will states, when you die, any joint tenancy property will go directly to the surviving joint tenant.
Accounts with a beneficiary
Any accounts with a designated beneficiary, such as a life insurance policy, will go straight to the benefitting survivor upon your death. Therefore, it is not necessary to include assets with a listed beneficiary in your will while you work on planning your estate.
Property held in a living trust
Setting up a living trust can help your estate avoid probate. Since the trust owns the property, it is not part of your estate, and you cannot include it in your will. Any property held in a living trust will automatically go to listed beneficiaries.
