According to a recent article, “The Confusing Fallout of Dying Without a Will,” from The Wall Street Journal, despite the consequences for their heirs and loved ones, millions of Americans still don’t have a will. The total wealth of American households has tripled over the past thirty years, according to the Congressional Budget Office. Still, more than half of Americans polled by Gallup said they didn’t have a will in 2021. Another survey showed that one in five Americans with investible assets of $1 million or more don’t have a will.
Dying without a will means the laws of your state will determine who gets your assets. In some cases, loved ones could end up with nothing. They could be evicted from the family home and even hit with massive tax bills.
This is especially problematic for unmarried couples. One example—after 18 years of living together, a couple had an appointment with an estate lawyer to create wills. However, the woman died in a horseback riding accident just before the appointment. Therefore, her partner had to get the woman’s sons, who lived overseas, to sign off, so he could be appointed her personal representative. The couple had agreed between themselves to let him have the home and SUV they’d purchased together. However, state law gave her sons her 50% interest. Therefore, he had to buy out her son’s interest to keep his home and car.
Dying without a will, or “intestate,” means you can’t name a personal representative to administer your estate, name a guardian for minor children, or distribute the property as you want.
Here’s what you need to know about having—or not having—a will:
State law governs property distribution. For example, in Florida, where there is a surviving spouse and children are children of both spouses, the surviving spouse gets 100% of the estate, and the children get nothing. If one of the children is not a child of the surviving spouse, the surviving spouse gets 50% of the estate and the child would get the remaining 50%.
Check on all assets for beneficiary designations. Retirement accounts and life insurance policies typically pass to whoever is listed as the beneficiary. However, if you never named a beneficiary, the state’s laws will determine who receives the asset.
If you don’t have a will and want to be sure a partner gets these assets, you’ll need to speak with Davie, Florida estate planning attorney, Carol L. Grant to explore your options. For example, you might be able to use a transfer on death deed or a payable on death account. However, there may be better ways to accomplish this goal.
Reference: The Wall Street Journal (May 2, 2023) “The Confusing Fallout of Dying Without a Will”