While having a will is vitally important, it is only one part of your estate plan. A will does not cover all of the bases in your estate including:
1. Life insurance payouts. You choose the beneficiaries of your life insurance policies when you take out the policy (or change the policy). No matter what you write in a will, it will not change who gets your life insurance benefit.
2. Community property. While state laws differ, in most cases you cannot disinherit your spouse from the property you both share.
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3. Assets held in joint tenancy with rights of survivorship. Any property held in joint tenancy passes onto the other tenant(s) when you die regardless of stipulations in your will.
4. Retirement assets and “transfer on death” accounts. Like life insurance policies, these retirement accounts and certain other accounts designate beneficiaries in their agreements. Those beneficiaries cannot be changed by a will.
There are kits you can buy to help you make your own will, but it’s wise to consult with an experienced estate attorney. How you set up your will may help minimize the amount of taxes your beneficiaries have to pay and will prevent you from overlooking assets that should be included.
Related Stories:
6 Steps for Establishing a Living Trust
3 Steps to Help You Plan for Long-Term Care
Finding the Right Life Insurance Policy
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