What are the common questions you should ask when you’re preparing a will? Also, what are some of the common questions that I get asked when people are preparing their will? You want to know the answer to both of all of these.
If you’re preparing your will, you want to ask questions like, how is this going to affect the designations on my bank accounts, my life insurance, my retirement beneficiaries? Is this going to contradict with any of those things or is this going to match and be supported by that stuff?
I would ask questions – how often do you need to update this? What are the probate dollar limits in your state and in Arizona? It’s $75,000 of bank accounts and cars, and it’s $100,000 of real estate equity. So, if you’re over that, your will has to go through probate, like a full probate. Those are the main questions I would ask.
Then, the third one that you should ask is, does this include some kind of a power attorney for finances and healthcare? Those are key issues to make sure you ask when you’re preparing your will.
Now, I get asked lots of questions when we’re drafting wills. We don’t do a lot of wills by themselves, we usually do it with a trust. A lot of times we get asked, why am I doing a will if I have a trust? Why do I need both? The question is pretty simple.
When you create a trust, you’re going to put everything in there. You’re going to the bank and say, put it on my trust. You register your cars, your insurance, and your house. It’s going to then say your trust name and all that stuff.
Why do I need a will? Because life happens and too many times people forget about something. They open a new account, or they sell the house and buy a new one. They end up passing away, and something’s out here not in the trust.
We have something called, it’s a special, unique kind of will. It’s called a pour-over will that says, “I don’t know if I forgot something, put it in my trust after I die. Then we’re good.” That’s why, yes, if you’re creating a trust, you also create a will to go with it.
I also get questions, like is the will where I name guardians? If you have minor kids, yes, absolutely it is. Is the will where you name an executor? Yep, bingo, you got it. Is the will where you designate who gets the little things around the house, jewelry, furniture, China, stuff like that. Yep, that’s where you can name that.
You have a couple of other options. You can put that in your trust. You can also put it on a separate specific type of memorandum in handwriting.
You do all of those things in the will, even if you have a trust as well. I get asked, do wills avoid probate in Arizona? The answer is generally no unless the dollar values are below the limits I described. Then, it doesn’t really avoid probate, but it uses a very simple form of probate if all you have is a will.
Those are the main questions to think about. You’re creating your will, you’re thinking about something that’s supposed to take care of business when you’re gone. So, work with somebody who’s helped families take care of that business a hundred times, a thousand times because there’s going to be things that pop up that you would have never thought of.
You’ve never been through that stage before, none of us have. We’ve only helped people go through it thousands of times, so we see the nuances and issues that sometimes are unthinkable. I never would have thought that would have happened. So that’s why there’s a lot of, well, what about this? What about that?
Then the last big question you need to ask, and that I get asked and that I think everybody should change how they prepare their own will and their trust. Don’t I need to create instructions for what would happen in five years, in 15, and in 20 years?
No, no, no, no, absolutely not. Your will should be written for what is relevant today. It should be written for today. Maybe a little hypothetical situation you deal with for tomorrow or the next day?
Guess what? How good were you five or ten years ago at predicting where you would be exactly right now? Think about your life five or ten years ago. Where did you live? Where did you work? Where did your kids live? Where did your grandkids live? What was the world like ten years ago?
Could you have predicted the situation today? The answer is no. If we could, we’d seriously be wealthy. We can’t predict it accurately. So, why put it in a legal document that’s just going to be wrong?
Do it for today and then commit to yourself – “I’m going to revisit this and just check on it once a year.” Then you do it once a year. just double-check, double-check, double-check, double-check, double-check,. Then, the last time you double-check it, it’s going to be actually relevant to that year. Which is, that’s when your family actually gets the gift of an organized estate.
Summary
When preparing a will, ask key questions about its impact on financial designations and the need for updating. Understand probate limits in your state. Ensure it includes powers of attorney for finances and healthcare. When creating a trust alongside a will, use the will to name guardians, and an executor, and distribute personal items. Seek legal guidance and avoid over-planning for distant future scenarios in your will; revisit and update it annually for relevance.
