I’m not married so I am quite late to this game, but I have concluded that I definitely need to create a will. My assets are relatively simple (no businesses, for example) and there might only be one beneficiary (at most two).
I am wondering if anyone knows, or have favorite links with info, for the best practices for setting this up properly. State of California.
Thank you!
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Does the value of your assets (not net worth) exceed $166,250?
Have you definitely concluded that you don’t need a trust?
I don’t think a will is needed for accounts that can name the beneficiary directly, but IANAL.
You can probably google the right instructions for DIY if a will is all you need. Nolo has some pages on this, and books. If you need more, then IMO the best way to do this is to sign up for a group legal plan (like MetLife/Hyatt) if possible, then have an in-plan attorney do the estate plan (includes will and trusts) for free. Otherwise the cost of something like that was $2K-5K last I checked around SoCal.
That last recommendation was what we did. Employer had a sponsored legal plan which entitled us to having an estate attorney setup our living trust up to some limit in hours of consultation. Ended up costing us $30 total + recording fees.
Only caveat is that prior to consultation with attorney we had decided 90% of the issues and structure of the trust which saved a lot of time in consultation. Attorney ended up more double checking our draft and entering it all in legal format for our state, alerting us of potential issues, and a couple of options we had not considered. But bottom line is it was far from 100% hand-holding and we had to do a lot of homework beforehand. If we had needed more guidance or had a very complex family situation, this may not have been enough though.
To become aware of the various issues, I remember using a combination of Quicken Willmaker (had an old version from bundle with Quicken) and Nolo online resources. I’d definitely start with free online resources to explore options, become aware of terminology, and help define whether will (our initial thoughts) or living trust is more suited to your needs.
Regardless of how many you have, best practices depend on how many heirs could potentially come forward. Like if you are cutting someone out (giving everything to one child, and excluding the other), or if your youth included a lot of one night stands that might’ve been more ‘productive’ than you thought.
Given my own circumstances, I’d be fine with something literally scribbled on the back of a napkin. If you are leaving money to a child and dont want their mother to get her hands on it, you probably should use a lawyer.
More importantly, name POD (Payable on Death) beneficiaries on your bank accounts, so they can bypass the probate process. Same with brokerage accounts and IRAs. With that in place, it’s as simple as notifying the institution of your death and they’ll distribute the assets accordingly. Using a will to direct those distributions means probate, executors, court, and lots of costs - best to minimize what is handled via that route.
I don’t have much to add, other than to say that if you live in Louisiana, most of those cheap ways to do a will without individualized advice from a lawyer are wrong.
Asking all the right questions here. Everyone should have a will. The question is whether you should also have a trust.
Wills are great at telling probate courts where your stuff goes and making sure your wishes are protected.
Trusts do the same thing and skip the bureaucracy.
This is an oversimplification, but In the right direction. The nice thing is that this type of work is typically just copy and paste kind of stuff and can be done very cheap on legal zoom or through a legal plan.
Informational purposes only. Not legal advice!
That dollar amount is important detail. The $166k figure there is the threashold in CA for whether or not the estate requires probate. If you have less then that you dont’ have to do probate. If itts more than that then probate is required.
Probate fees can eat up 2-4% of your money depending on the amount. SO depending on the amount of the estate this will determine if you want/need to go to extra steps to avoid probate or not.
Banks? Are you sure it’s a good idea to login to a dead person’s bank account? Checking the balance is probably fine, but it’s probably illegal to take any other actions. IMO it should not be passwords, it should just be account numbers so they’re easier to locate.
Same for frequent flyer miles – I’d think it’s illegal to cash out those miles.
Exactly. Also probate could take years (average is 12-18 months in CA). And if you have a house with a mortgage and the mortgage does not get paid while the house is in probate, it could be foreclosed.
One additional warning. If the bank is where SS checks get deposited, the account will be locked within a month of death. SS gets notified by the local authorities (I think that’s who does it) when you’re declared dead. SS then notifies the bank.
If the deceased has bill pay set up, they will start bouncing right and left. This will occur long before the executor gets appointed and opens an estate account. It’s a PITA.
I don’t disagree, I just think it’s illegal and could become a much bigger problem later on. Especially with financial accounts. Except for joint signer – that should not be a problem because each joint owner has the exact same rights and own the account in full.
Could? Yes. But, for the most part, you as the proper/eventual recipient of the assets would have to initiate a claim that the funds had been improperly stolen…by yourself. Again, circumstances do matter. The only thing you do NOT want to do is continue using the deceased credit cards, then report the cardholder deceased and not pay the balance.
I recall a FatWallet thread, where a funeral home made a mistake on a death certificate, which went into to the SSA’s system and resulted in the guy’s banks flaging him as deceased. I dont recall all the details, but it was pretty clear that the error filtered down from the SSA.
For a bank account I’d think would be better to have a beneficiary named for the account as ‘payable on death’ or ‘transferable on death’.
At least in OP’s case since they only have the one heir in mind so it would be straight forward to just name that person as beneficiary. Then they just get the money and I believe it avoids probate too.
I don’t know much about how all this works but thats my understanding.
Delta reversed themselves on mile TOD and won’t do it anymore.
I’d definitely try to spend them down if possible, or use their login credentials. You’ll often also need a CC in their name too. I see people all the time in the frequent flyer forums having trouble with this when a family member dies.
Don’t the airlines claim the miles have no value to start with? Legality of transfer may be questionable but what is the injured party if a family member or executor transfer them without express consent of the deceased? How could the airline argue that they were harmed by the transfer of something they deem has no value?
If someone died wilth a million miles and then those miles were stolen instead of written off to 0, the airline is the injured party 
. Even if the miles may have no value as miles, if they were exchanged for something of value (tickets), the value can be established.
They can still not allow it, even if they werent “harmed” (however you wish to define that standard). If you did use someone’s miles after their death, I doubt there would be any consequence beyond a stearn talking to. And any unfulfilled redemptions being cancelled. Unless you took a million point balance and quickly sold reward flights to random third parties, they arent going to sue you - and even then, it’d be for selling rewards flights more than using the dead person’s account.
Folks, thanks for the excellent info. There’s a lot more issues raised here than I counted on.
To answer a question, my assets are above the level for probate in CA.
However almost all of my assets are in a few bank accounts, a 401k, and a couple brokerage accounts. I don’t own real estate currently.
Is it sufficient to simply add beneficiaries to all these accounts (including the brokerage accounts containing stock)?
Fascinating. Thank you for posting. And I acknowledge you are referring to today and that it might have been different years ago. Still for me an eye opener, because you see:
Our parents had reciprocal wills. Father was last to pass, and at that time my sister was a California resident. She and I were sole beneficiaries and I was executor. She and I visited dad’s lawyer together and took possession of his will. We then travelled to the county seat of the county where he resided to submit the will for probate and obtain the letters of administration. Thereafter, using those letters, I liquidated everything and made disbursements in accord with the terms of the will.
Bottom line, my sister had possession of her inheritance within about ten days. That must have surprised her, as a Californian, if she was anticipating a much longer wait for the money. It did help, I suppose, that there was no lawyer involved.