Dear Quentin,
I’ve finally decided to write a will, and I’m doing it with the help of an attorney. I will be dividing my estate between family and a couple of close friends. I don’t want to end up with stalkers, but I know my family will want to know how I intend to divide my estate.
Do I tell them that I am mentioning them in my will? And do I tell them what they will be receiving upon my death? Or do I write my will and file it and say nothing to anyone? It would be nice to share my intentions so they have something to look forward to, but I’m not sure if this is common.
Writing a Will
You could, depending on how events pan out over the next 10, 15 or 20 years, change your mind.
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Dear Writing,
This will be your final word — or will it?
The risk you take by telling your nearest and dearest that they are included in your will is that you could, depending on how events pan out over the next 10, 15 or 20 years, change your mind. That could leave you in a pickle — you’d have to explain your changes or simply leave things as a nasty surprise after you’ve gone that a close relative has been cut from your will.
In a worst-case scenario, people who tell the world who, exactly, stands to inherit from their estate could end up as a protagonist in a real-life case like one from “Columbo” or “Murder, She Wrote.” If you have a lot of money, your beneficiaries may behave oddly or pester you for an early inheritance. Or you could end up with a new “friend” like this man if your health starts to fail.
There are some grisly cautionary tales. This woman was sentenced to life in prison without parole for conspiring to murder her firefighter husband. She had debts, so she faked Stage 4 breast cancer and wanted to get her hands on her husband’s $ 100,000 life-insurance policy. But her husband had never changed the beneficiary on that account, so it was his ex-wife who ultimately received the payout.
You are wise to have written your will with the help of a lawyer. Holographic, or handwritten, wills are legal in about half of the states in the U.S, but it’s simply not worth writing a will on the cheap or downloading one from the Internet. Too many things can go wrong. (Read here about Aretha Franklin’s handwritten will.)
And don’t neglect to make provisions for what happens while you are alive. Arguably, this is even more important than creating a will or a trust. Name someone who will have power of attorney to be able to make financial decisions during your lifetime should you become incapacitated, as well as someone who has medical power of attorney to carry out healthcare decisions as set out by you ahead of time.
Trust versus will
If you want your estate and your wishes to remain private and confidential, a trust will serve you better than a last will and testament, which will go through probate court. When your will is filed with probate court, it becomes part of the public record, and your family members, extended family members, friends, next-door neighbors and old high-school classmates can access it.
If you set up a revocable trust, you can be both grantor and trustee during your lifetime, and you have the freedom to change the terms. You can leave instructions to distribute the assets held by the trust according to your wishes. Those wishes, as I said, may change over your lifetime. You can retitle your home, bank accounts and other assets into the trust.
There are limitations to a revocable trust. It cannot, for example, be used to make medical decisions during your lifetime, protect you from civil judgements or creditors, or help you qualify for Medicaid, the program that provides medical care for low-income Americans. A trust can be expensive to set up and comes with ongoing administrative and legal costs.
Another important task: Appoint an executor of your estate — ideally, someone you trust. And if you decide to set up a revocable trust, you can nominate a relative, friend, attorney or financial institution as a successor trustee. Such a trustee is a fiduciary, and as such has a legal and ethical duty to carry out your wishes.
A revocable trust becomes irrevocable upon your death. However, you could add a “trust protector” clause naming a third party that oversees the actions of your trustee. The American Bar Association says this person can correct mistakes made in a trust or modify it to take advantage of tax law. They can also approve accounting and compensation.
A final thought: In our social-media era, privacy is vastly underrated.
The Moneyist regrets he cannot reply to questions individually.
Previous columns by Quentin Fottrell:
‘We were all set to enjoy our retirement’: My son invested in startups and we bailed him out with $ 100,000. What now?
‘I’d rather wear a potato sack’: I’m a bridesmaid at three weddings. The brides chose ugly dresses — and I’m obliged to pay. Should I say no?
‘He’s quit talking to me’: My father, 83, suffers from hoarding disorder and dementia. How can I help him and protect his estate?
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