Many people are aware that creating a will is a good way to protect your wealth and ensure that your assets are passed on to your beneficiaries. You may not be aware that there are some assets that you should not include when writing your will. Property that already has laws governing its distribution should not be included. The following types of property should be excluded when writing your will:
- Transfer on death property: These assets do not need to be included in a will because they pass automatically to the person who was named a beneficiary on the account. Transfer on death assets include real estate, vehicles, and stocks and bonds.
- Pay on death bank accounts: Similar to transfer on death property, these types of assets go directly to the beneficiary after the account holder passes away.
- Property with a right of survivorship: Some property is communally owned by more than one party, and if the asset has a right to survivorship, the surviving party will take ownership of the property at the time of the other party’s death. It cannot be transferred onto beneficiaries in a will as long as one of the joint owners is alive.
- Life insurance and annuity benefits: These assets cannot be included in a will. The benefits of a life insurance policy or annuity are automatically passed on to the designated beneficiaries at the owner’s time of death.
- Proceeds from 401k and other accounts: 401k accounts, retirement plans, IRA’s and pensions all have a similar payout policy as life insurance: only those named as beneficiaries receive the funds after the death of the account holder.
What you should include in your will
After reading the above exceptions, you might be wondering what types of assets you should include in your will. The good news is the answer is fairly simple: all other assets. Generally speaking, any asset that is not automatically paid or distributed upon the death of the asset holder should be included in the will. If you are unsure of which assets you have, consider keeping a notebook that lists all your different assets to see which should be included and which should be left out. Keep this with you until you are ready to write your will. If you are unsure, you may seek the assistance of an experienced estate planning attorney to help you review your assets and decide what should be included in your will.
You do not need to wait until you have built significant wealth or assets to begin drafting your last will and testament. The Boutty Law Firm is a Central Florida law firm that has helped many families protect their wealth and assets through estate planning. We assist in the writing of wills, as well as other estate planning services, such a probate and estate administration. For more information on wills and to get in touch with an estate planning attorney, call our Winter Park office at 407-537-0543.