Who Will Get Your Property?

April 13, 2006

	Visited: 230
	Not rated
	Rate:

If you don't care what happens to your property at death, and you don't have minor children on the scene, you probably don't need a will. This, however, is not the usual case. Most of us have people or organizations that we would like to benefit. But, unless these objects of your bounty are the same ones that would receive the property under your state's intestacy rules, they will be out of luck if you don't provide for them by will.

Generally speaking, you can give your property to whomever you wish to, and, with a few exceptions, you can't be made to give your property to anyone just because he or she is a close relative.

The most important exception to this rule involves spouses. In one form or another, almost all of the states provide that a spouse can insist on receiving at specified minimum amount from the estate (often 1/3 to 1/2, depending on whether there are children from the marriage). Thus, if a deceased person's will doesn't give the spouse this minimum amount, the spouse can elect to receive what is known as his or her "forced," or "statutory" share. If this happens, the will remains valid, but spouse gets the specified share and the amounts received by all other beneficiaries are reduced according the state's applicable probate rules.

Another exception involves contractual wills. If you have executed a joint and mutual will (a single will that is effective to dispose the property of two people), while both people are living they can agree to change the will, if they want to. However, once the first of them dies, the will becomes irrevocable and unchangeable with respect to the second person. If this is the case, it generally will not matter that circumstances have changed such that the decedent would have changed the will if he or she were still around to do so.

Warning

Because a joint and mutual will — or any other form of contractual will — can lock you into a plan for distributing your wealth that is outdated in light of changed circumstances, we recommend that you try to avoid such arrangements. If you want to exercise some degree of continuing control over property that you transfer after death, a trust arrangement usually is preferred.

Further, although many people who opt for joint and mutual wills probably do so in hope of saving money, such savings will be minimal, if anything at all. The will document will still have to be probated twice (once at the death of each testator). Further, it's doubtful whether the attorney drafting the mutual will document will give a discount based on the fact that only one document is involved.