As you celebrate the holidays with family and friends, ask yourself:
- Who do I want to get my belongings if I die?
- Who do I want to get my money if I die?
- Who do I want to care for my minor children if I die?
The festive holiday season may not seem like an appropriate time to think about your end-of-life plans, but it’s actually a great time to remember that if you do not put your wishes in a will, the state of Georgia will make your decisions for you. That means the people you care about the most may suffer needless stress -- financially, emotionally, and legally.
Let’s consider the hard facts – and some easy solutions.
According to various surveys, only about 40 percent of adults in the U.S. have a will. The number is even lower – about 35 percent – for people with children under the age of 18. Not surprisingly, older Americans are the most likely to have a will – about 80 percent age 72 or older – while a staggering 80 percent of millennials (ages 18 to 36) and 65 percent of Gen Xers (ages 37 to 52) do not have a will.
Consider this amazing statistic: 70 percent of family businesses in America don’t continue past the first generation, with the primary reason being a lack of proper estate planning by the owners.
The reasons vary for why people do not create a will, but typically include not having enough time, not having enough assets, and not being able to afford it. However, a will is very affordable for most people – for example, by working with a Certified Public Accountant rather than a lawyer or by using software such as Quicken Willmaker Plus (about $50).
If you complete templates such as those available on the Quicken software or on certain “no charge” online sites, you can considerably reduce the amount of time you need to spend with a lawyer.
And wills are not just for those who own lots of stock, real estate, artwork, or pricey heirlooms. Your “assets” include your bank accounts, your house, your car, and your everyday belongings such as clothes, jewelry, and furniture. Your will specifies how you want this property handled.
If you die without a will – which is called dying “intestate” – it is the state that controls who receives your property. In Georgia, your assets are distributed under specific succession sequences and formulas. Factors include whether or not you have living children, grandchildren, parents, or a spouse – and the law specifies who receives what percentage of your estate.
You probably want to avoid this type of government bureaucracy and having a will does that. Here are five other valuable benefits of a will:
- Control distribution of assets – you designate who gets what, notable
- major belongings such as real estate; stock; retirement or pension accounts; life insurance policies; business ownership; and vehicles -- cars, boats, motorcycles, ATVs, and planes
- everyday property such as clothes, jewelry, and furniture
- heirloom items such as a coin collection; classic cars; or historic artifacts
- Protect minor children – you choose the legal guardian who will care for your children under the age of 18, instead of leaving this very important decision to a judge
- Minimize estate tax – you can reduce inheritance tax in several ways, for example, by donating money or property to a favorite charity
- Chose an administrator -- someone must manage the process of executing your will. This person, known as an “executor,” will pay all bills and debts, then will coordinate distribution of the remaining assets according to your wishes. Certainly you want to select a person for this important task who you trust highly.
- Specify funeral preferences – you outline the details for a remembrance ceremony; for how you want your body treated (burial or cremation); and for handling certain expenses, such as arranging a term insurance policy to pay for funeral costs
One caution: don’t confuse a “will” with a “living will.” A will, also known as a “last will and testament,” specifies how you want certain things handled after your death. A “living will” – which is often called an “advance directive” – outlines who can make decisions about your medical treatment if you can no longer communicate, such as if you are in a coma or in a permanent vegetative state.
While a “will” and a “living will” are different in purpose, their objectives are similar – namely to speak for you when you can no longer speak for yourself.
Having these documents in good order can make difficult times less difficult -- by eliminating unnecessary confusion, disagreements, and dealings with lawyers and government bureaucracy. What better gift for your family and friends this holiday season!
Navin Shah is Chairman of Royal Hotel Investments, which owns and operates two hotels in Covington and one in Conyers. He is also Vice Chairman of Embassy National Bank, a community bank in Lawrenceville that he helped establish in 2007 and has become one of the leading SBA “Preferred Lenders” in the southeast. He can be reached by e-mail at email@example.com