A lot of individuals don’t want to think about their own passing, but if they want a say in what happens to their assets when they do, it’s important to take the time to create a will.
Creating a will should be deemed a priority so you can have a say in what happens to your assets when you pass away. If you pass away without a will, the repercussions range from minor annoyances such as postponements to added strain to your loved ones.
What happens if there is no will?
Passing away not having a will, or passing away intestate, is going to mean that assets are not going to necessarily end up where you wish them to. When you have joint financial institution accounts or accounts with an appointed beneficiary, those are almost always going to transfer systematically. It is highly suggested meeting with an estate planning attorney to best safeguard your assets.
When you are the owner of financial assets with a beneficiary, for instance, a retirement account, specific pensions, and/or particular financial institution accounts, those can pass to a beneficiary without being probated.
Furthermore, real estate owned in joint tenancy with survivorship is going to systematically pass on to your spouse but forewarns that other real estate shared-ownership agreements are not going to. Nevertheless, should you own property with someone as joint tenants in common, your portion of that property cannot be passed to the co-owner without being probated.
Every state has their own intestate succession statutes. In a lot of places, the estate systematically transfers to the decedent’s spouse and, for single individuals, to any child(ren) or to the parents. There is always a chance of hindrance.
The problem of intestate succession is some assets might have to be ‘opened’ by a court. Meaning that financial institution accounts in one spouse’s name is not automatically going to go to the other spouse when its intestate succession. There is going to need to be an administration through probate court first.
What is probate?
Probate is the method that the court uses to distribute the decedent’s estate. This applies to those that have wills and those that don’t. Probate can be expensive and is public.
Probate is a public and potentially expensive process in California, influenced by family dynamics and estate valuation. For instance, a $500,000 estate incurs $11,000 in probate fees. Although complete probate avoidance is impossible, a will and joint accounts can simplify the process.
Probate with a will grants the deceased control over estate management. Creating a will informs the probate court of your wishes and appoints responsible individuals. Without a will, the court interprets your desires, potentially leading to disputes over administrators, beneficiaries, and distribution challenges.
Other thoughts when creating your will
For things that do not allow beneficiary designation, consider establishing a revocable living trust to circumvent the probate process. Real estate is a very favorable asset to put into a revocable living trust to circumvent probate.
Another aspect in establishing your will could be minor children or any debilitated dependents. Disregarding creating a will means relinquishing control over who is going to care for your children upon your passing.
Not having a will grants the appointed guardian control over inherited assets. If assets pass to minors, the guardian manages them, risking mishandling. Once the child is no longer a minor, they gain full access and control.
Creating a will may not be enjoyable but is necessary for post-death wishes. Everyone will pass away, and without a valid will, control of your estate passes to someone else, potentially undesired. A will ensures your preferences are honored.
What happens if you die without a will? LegalZoom. (n.d.). Retrieved April 28, 2023, from https://www.legalzoom.com/articles/what-happens-if-you-die-without-a-will