Wills

John F. Kennedy. Jackie Kennedy Onassis. Leona Helmsley. Jerry Garcia. What did they all have in common? They all disposed of their estates with wills. These days, the plain vanilla will has been upstaged by the more popular living trust (see previous post). That doesn't mean that you should ignore a will in your estate plan. Wills are still a vital and important part of any plan, even if you do have a living trust, and for many people with few assets, a will is probably the best way to handle your estate.

A will is essentially a set of instructions on what to do when you die. It only takes effect upon your death. In it, you designate someone to administer your estate (known as the executor or personal representative). You also name your heirs and identify what in your estate you want them to receive. These two aspects of wills can be handled by a living trust via establishing a trustee and contingent beneficiaries. Because of certain advantages of living trusts (e.g., no probate and generally lower administration costs) living trusts have basically replaced wills for these purposes.

But wills shouldn't be forgotten. A will is the only way to establish a guardianship for your minor children. If both parents die before the children turn 18, then the court will establish a guardian for the children unless there is a valid will in place that designates a guardian. A will is also where you leave instructions for your funeral or burial, and where you set up a power of appointment. If you have a living trust, you will still need a will to transfer your assets into that trust that you have accumulated since the creation of the trust (this is known as a "pourover will").

Wills are still sometimes the best method of disposing of an estate. In California, an estate of less than $100,000 qualifies for summary probate proceedings, and may even avoid probate altogether. You can revoke or modify your will at any time (provided you still have the capacity to do so). Wills are also generally much shorter and simpler documents, and so are less expensive to prepare.

So don't give up on the humble, time-honored will as a cornerstone of your estate plan.