Page 25 - HCN Senior Planning Guide August 2020

Why Make a Will?
It’s Helpful ... Like Driving with Google Maps By LIZ SILLIN
It is a product of the COVID-19 era, but we have found that many people are thinking about wills and other estate-planning issues this year. The truth is
that people of all ages should be thinking about a will, and not just during a pandemic.
What is a will, and why would you
want one?
A ‘last will and testament’ is a document that spells out who it is that you would like to receive certain assets of yours — your ‘probate assets’ — at your death. In it, you name a ‘personal representative’ (formerly known as an executor/executrix) who oversees the directives in your will.
If you have minor children, you name a guardian and conservator for them. A will is a formal document, signed in front of two disinterested witnesses and a notary who attest to your apparent soundness of mind and that you appear to be over the age of 18 and signing willingly.
It’s a little like having Google Maps for those
you leave behind — it lays out where you want your assets to go and how to get there. You can say who you want to receive specific assets, be it your mother’s wedding ring or your house, and you can direct assets to family, friends, and charities in whatever proportions you wish.
If you die without a will, state law takes over. The state has tried to determine what most people would want in the absence of a will, but it is not nuanced. For example, if you are married and all your children are from that marriage, state law presumes that you want all your probate assets to go to your spouse — no direct gifts to your children, no charitable gifts,
no gifts to friends. By contrast, if you are married
and have children from a prior marriage, then state law presumes that the first $100,000 of your probate assets should go to your surviving spouse, and the rest of the probate assets are split 50/50 between the spouse and the children of the prior marriage.
State law cannot know that you have a disabled child who needs a special-needs trust or a house that you really want your surviving spouse to have. State law also sets forth who has priority to serve as your personal representative if you don’t have a will.
We should pause to talk about ‘probate assets.’ These are assets that you own in your own name — not jointly with someone else and not owned in a trust — and assets as to which you have not made
a beneficiary designation or a pay-on-death payee. You own a house in your own name — it’s a probate asset. You own a house jointly with your spouse
— it transfers to the spouse by operation of law at your death and is not a probate asset. If you have a retirement asset, such as a 401(k) or an IRA, or a life- insurance policy on which you have filled out a form designating a beneficiary, the asset passes to that beneficiary at your death and is not a probate asset.
If you make a will and in it you say your life insurance proceeds go to Joe, but your life-insurance
“It’s a little
like having
Google Maps
for those you
leave behind
— it lays out
where you
want your
assets to go and how to get there.”
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33
Wills
Continued on page 35
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Charles (Chip) L. Olson, CFP®
SVP, Wealth Management
860.990.0958 | chip.olson@peoples.com
Timberly V. Grout, CTFA, AEP
SVP, Senior Wealth Management and Trust Officer 413.735.6717 | timberly.grout@peoples.com
Investment products are offered through People’s United Advisors, Inc., a registered investment advisor and a wholly-owned subsidiary of People’s United Bank, N.A. *Banking products are offered through People’s United Bank, N.A. Member FDIC. **Insurance and annuity products are offered through People’s Securities, Inc., a Broker/Dealer, member FINRA and SIPC, an insurance agency and a subsidiary of People’s United Bank, N.A.
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