You need a Legal Will to prevent your deceased estate being wrongly or unfairly distributed under the intestacy law.
Over half of all people who pass away, die intestate.
An intestate estate means a death without a valid legal Will & Last Testament and it can cause your family a lot of grief. It’s bad enough that a family has to grieve the loss of a loved one. But an intestate estate can cause unnecessary family arguments and legal battles over the deceased estate.
Why You Need a Legal Will
If you die intestate your estate (your remaining assets after paying debts) will be distributed according to the intestacy rules provided in legislation that is applicable in the state or country that you live. This is normally the state/country where your assets are located. If you die intestate, your estate may well be distributed in a way that (if you were living) you may not approve of.
The government may also decide who looks after your children if they are still minors.
Unless your wishes and your personal situation coincides with the intestacy rules in your country/state you need a Will to express your wishes after you die.
One common example, is that upon your death, if you don’t have a legal Will, your estate may be distributed wholly to your surviving spouse, before further distribution to your children. Maybe you do not wish this to occur. You may wish your children to have varying percentages of your estate depending upon their age. You may wish to give fuller consideration to the circumstances that your adult children find themselves in, particularly in the event that they may be involved in a family law dispute, and your pending distribution may be included in the matrimonial property pool.
Another example, is that if you are unmarried and have no children when you die, your estate may be distributed to your parents whereas you may want your estate distributed to your brothers, sisters and their children.
Who Are Your Beneficiaries?
Sometimes, when people die it is difficult to find out if they have any relatives. If you have a reasonably up to date Will, which details your close relatives, at least the Executor will be able to identify your surviving relatives and inform them you have died.
Taxation Implications
There may be other considerations necessary to minimize tax obligations upon some of your beneficiaries. Leaving money to a wealthy relative may burden them with additional taxation whereas leaving money to a minor or poor relative may eliminate any tax burden.
If there are no close relatives to distribute your estate, your estate will go to the State Government.
What If I Have No Relatives?
If you have nobody to leave your estate to, at least create a Will that leaves your estate to a worthwhile charity, medical research foundation, scientific organization (eg NASA) or some worthwhile cause, otherwise your estate will go to the Government.
What If I Have No Money?
You may have no money but do you have life insurance?
Many young people don’t think it’s necessary to have a Will because they have little money to worry about. However, most people have life insurance attached to their pension retirement fund. Without a Will, the life insurance payout for a death may be distributed in a way that (if you were living) you may not approve of.
What Can Go Wrong If I Don’t Have a Legal Will?
Here are some examples of what can go wrong if you don’t have a Will when you die.
Estranged Father Collects the Estate
Katrina was 25 years of age when she died in a tragic accident. Katrina did not have a Will and her Estate received a $500,000 life insurance payout due to her accidental death. As she had died intestate her estate was distributed according to the intestacy law which has a formula for distributing assets when a person dies without a Will.
Katrina’s estate was divided with 50% allocated to each of her parents. This was even though her father deserted the family when Katrina was one year old and never paid a cent of child support.
The family claims there is no way Katrina would want her father to receive anything.
If only Katrina had made her wishes known in a Will.
Partner’s Children Received Nothing
Harry was born in England and immigrated to USA.
He lived in a de-facto relationship with his partner, Kate, for over twenty years. Harry helped raise Kate’s children from a previous relationship. These children lived with Harry until they were adults.
Sadly, Kate died before Harry and in her Will she left Harry her estate. Harry continued the close relationship he shared with Kate’s children for many more years.
When Harry died without a Will, Kate’s now adult children did not receive any of his estate. Not even the family home where they had lived their entire lives. Harry’s entire estate was given to his brother, living in England, who he had lost contact with years ago.
If only Harry had made a Will outlining who he wanted to receive his estate.
Spouse Not Entitled to the Whole Estate
Mary and Paul were married and had a daughter, Sally. Due to family disagreements, Sally was estranged from her parents for many years. When Paul died without a Will, instead of the entire estate passing to Mary, a portion was given to Sally. Even though, Mary maintained Paul would have wanted the estate to go entirely to her and not to Sally.
If only Paul had made a Will naming his wife as the only beneficiary of his estate.
Take the First Step & Get a Legal Will
If you don’t have a legal Will or want to update an old document, contact a lawyer and ask for advice. The other option is to search online for a Will kit and follow the procedure.