The way for our wills?
April 23, 2020 7:59 AM Subscribe
My spouse and I have an informal understanding of what we'd like in terms of our wills. Before we talk with a lawyer, can you help us refine our ideas?
Context
We're in our 50's, have no children, and live in Massachusetts. Our net worth is considerable (we’re not 1%-ers, but in the top 10%), we’re mostly living off it now, and we’re frugal. Of the two of us, I’m the one who had both the privileged background and the high earnings. There are two stages to consider for our wills: when the first of us dies and when the second does.
I. When the first of us dies, we want $xxK to go to each of a few family members on our own side (siblings and parents) if they are alive, with everything else retained by the surviving spouse.
II. When the second of us dies (or if we die together), we want:
-- xx% or $xxxK (whichever is less) to go to charities in proportions and amounts we'll list.
-- $xxK to go to the person who takes in each of our cats.
-- The remainder to be split in three equal shares for my spouse’s sibling and my two siblings. If either sibling with children isn't alive, that share is to be split among that sibling's children. If my sibling without children isn't alive, his share is to go to my other sibling (along with her own share), or if she is not alive, split between her children. We'd like most of what goes to young children to be held for them until they're older.
We do not want II. to be legally binding on the surviving spouse, in case of anything unanticipated. We do want it to be the default. We'll each trust that the other won't amend it arbitrarily.
Other aspects of the will, such as particular items we want particular people to get, burial wishes, trusts, and executors are topics we'll handle or figure out with a lawyer.
Questions
We'll get a lawyer's input on these questions, but we'd love to get an initial take before that step.
1. Is any of this unusual or surprising? What would be more standard?
2. In I., our first priority is that the surviving spouse has plenty for whatever life brings, but we don't want the amount for each family member to be unnecessarily stingy. We don't know what would be too low or too high. How should we decide?
3. Also for I., these amounts would have to come from accounts that are co-owned, or that have the surviving spouse as the beneficiary, because that describes almost all of our assets. But I read that those kinds of accounts aren't governed by a will. So how is this done?
4. At this stage, should we find a lawyer?
- Would we save on lawyer fees if we get a little further first with Rocket Lawyer, LegalZoom, or something like that? What about if we take on writing a draft based on a template, before or after we meet with a lawyer?
- After we do work with a lawyer, we'd like to be able to make minor amendments over time, without having to go back every time. Is there anything to do up-front to make that possible?
Context
We're in our 50's, have no children, and live in Massachusetts. Our net worth is considerable (we’re not 1%-ers, but in the top 10%), we’re mostly living off it now, and we’re frugal. Of the two of us, I’m the one who had both the privileged background and the high earnings. There are two stages to consider for our wills: when the first of us dies and when the second does.
I. When the first of us dies, we want $xxK to go to each of a few family members on our own side (siblings and parents) if they are alive, with everything else retained by the surviving spouse.
II. When the second of us dies (or if we die together), we want:
-- xx% or $xxxK (whichever is less) to go to charities in proportions and amounts we'll list.
-- $xxK to go to the person who takes in each of our cats.
-- The remainder to be split in three equal shares for my spouse’s sibling and my two siblings. If either sibling with children isn't alive, that share is to be split among that sibling's children. If my sibling without children isn't alive, his share is to go to my other sibling (along with her own share), or if she is not alive, split between her children. We'd like most of what goes to young children to be held for them until they're older.
We do not want II. to be legally binding on the surviving spouse, in case of anything unanticipated. We do want it to be the default. We'll each trust that the other won't amend it arbitrarily.
Other aspects of the will, such as particular items we want particular people to get, burial wishes, trusts, and executors are topics we'll handle or figure out with a lawyer.
Questions
We'll get a lawyer's input on these questions, but we'd love to get an initial take before that step.
1. Is any of this unusual or surprising? What would be more standard?
2. In I., our first priority is that the surviving spouse has plenty for whatever life brings, but we don't want the amount for each family member to be unnecessarily stingy. We don't know what would be too low or too high. How should we decide?
3. Also for I., these amounts would have to come from accounts that are co-owned, or that have the surviving spouse as the beneficiary, because that describes almost all of our assets. But I read that those kinds of accounts aren't governed by a will. So how is this done?
4. At this stage, should we find a lawyer?
- Would we save on lawyer fees if we get a little further first with Rocket Lawyer, LegalZoom, or something like that? What about if we take on writing a draft based on a template, before or after we meet with a lawyer?
- After we do work with a lawyer, we'd like to be able to make minor amendments over time, without having to go back every time. Is there anything to do up-front to make that possible?
Question 3 What you hear is right. When we did estate planning, we had to remove co-ownership or beneficiary from enough assets for money to pay final expenses (funeral, medical expenses, credit cards, etc.) and the bequests to others than our surviving spouse. An experienced estate attorney will help you identify the appropriate amount.
You still want the bulk of your assets in both names/beneficiary so the surviving spouse can have that money without the time that probate takes.
Question 2 I suppose this depends on the size of your estate and your families' general wealth. $1000 might be exciting for many; for others $20000 might not be enough. Boy, is this a judgement call only you can make. Of course, I'm not sure you should give a lot of weight to fear of appearing stingy. It's your money. Plus you'll be dead and your relatives/friends can and will say whatever they want to about you.
You might also want to consider need. A beneficiary with many children or a lasting health condition might be bequested more money that a single healthy person, etc.
Question 4, second part Your will can specify that you will make a separate memo bequesting small value things. Like jewelry, art, etc. The memo can be changed over time without amending the will. Also, your wills should be made for today and for the immediate future. Things will change over time and you'll need to go back to an attorney for changes to the will itself. You need a lawyer's help now; you will when you make changes. You don't want your will to be contested.
Remember as things change to change your wills!
I hope you found, as we did, that there was nothing morbid about this process. When the wills were finalized we felt a sense of confidence and relief.
posted by tmdonahue at 8:25 AM on April 23, 2020
You still want the bulk of your assets in both names/beneficiary so the surviving spouse can have that money without the time that probate takes.
Question 2 I suppose this depends on the size of your estate and your families' general wealth. $1000 might be exciting for many; for others $20000 might not be enough. Boy, is this a judgement call only you can make. Of course, I'm not sure you should give a lot of weight to fear of appearing stingy. It's your money. Plus you'll be dead and your relatives/friends can and will say whatever they want to about you.
You might also want to consider need. A beneficiary with many children or a lasting health condition might be bequested more money that a single healthy person, etc.
Question 4, second part Your will can specify that you will make a separate memo bequesting small value things. Like jewelry, art, etc. The memo can be changed over time without amending the will. Also, your wills should be made for today and for the immediate future. Things will change over time and you'll need to go back to an attorney for changes to the will itself. You need a lawyer's help now; you will when you make changes. You don't want your will to be contested.
Remember as things change to change your wills!
I hope you found, as we did, that there was nothing morbid about this process. When the wills were finalized we felt a sense of confidence and relief.
posted by tmdonahue at 8:25 AM on April 23, 2020
1. Is any of this unusual or surprising? What would be more standard?
None of this sounds unusual.
3. Also for I., these amounts would have to come from accounts that are co-owned, or that have the surviving spouse as the beneficiary, because that describes almost all of our assets. But I read that those kinds of accounts aren't governed by a will. So how is this done?
Trusts can be structured to take care of this.
4. At this stage, should we find a lawyer?
Yes. The first consultation with Wills and Estates lawyers are almost invariably free. You can ask them about fee structure, how to make amendments, and all of that over time.
Would we save on lawyer fees if we get a little further first with Rocket Lawyer, LegalZoom, or something like that? What about if we take on writing a draft based on a template, before or after we meet with a lawyer?
If you're as well off as you indicated, this isn't something I would futz around on if you're particular about getting the instrument to do exactly what you need it to do. Most lawyers charge flat fees on this, I can't imagine this costing more than 2k. The lawyer will answer most of your questions up front, and then send you home with a questionnaire to ensure you get a document holistically gets what you need. The language, structure, etc. all of this have state by state implications that have to be considered that the online stuff doesn't always capture.
posted by Karaage at 8:28 AM on April 23, 2020 [3 favorites]
None of this sounds unusual.
3. Also for I., these amounts would have to come from accounts that are co-owned, or that have the surviving spouse as the beneficiary, because that describes almost all of our assets. But I read that those kinds of accounts aren't governed by a will. So how is this done?
Trusts can be structured to take care of this.
4. At this stage, should we find a lawyer?
Yes. The first consultation with Wills and Estates lawyers are almost invariably free. You can ask them about fee structure, how to make amendments, and all of that over time.
Would we save on lawyer fees if we get a little further first with Rocket Lawyer, LegalZoom, or something like that? What about if we take on writing a draft based on a template, before or after we meet with a lawyer?
If you're as well off as you indicated, this isn't something I would futz around on if you're particular about getting the instrument to do exactly what you need it to do. Most lawyers charge flat fees on this, I can't imagine this costing more than 2k. The lawyer will answer most of your questions up front, and then send you home with a questionnaire to ensure you get a document holistically gets what you need. The language, structure, etc. all of this have state by state implications that have to be considered that the online stuff doesn't always capture.
posted by Karaage at 8:28 AM on April 23, 2020 [3 favorites]
1. Sounds like an entirely normal mirror will to me.
2. Percentages? So maybe 90% to your spouse and the rest divided?
3. Not in the US, so won’t speculate.
4. Most lawyers we approached had a set fee for uncomplicated wills (which yours is - complicated would involve trust funds etc). It would not have made any difference how far down the route we were, the fee would have been the same. And the advantage of speaking to a lawyer early for us, was that she told us straight away about things we hadn’t considered (inheritance tax stuff, in our case). So we didn’t waste time on dead ends.
posted by tinkletown at 9:44 AM on April 23, 2020
2. Percentages? So maybe 90% to your spouse and the rest divided?
3. Not in the US, so won’t speculate.
4. Most lawyers we approached had a set fee for uncomplicated wills (which yours is - complicated would involve trust funds etc). It would not have made any difference how far down the route we were, the fee would have been the same. And the advantage of speaking to a lawyer early for us, was that she told us straight away about things we hadn’t considered (inheritance tax stuff, in our case). So we didn’t waste time on dead ends.
posted by tinkletown at 9:44 AM on April 23, 2020
One common arrangement is for the 1/2 of the estate that belongs to the first to die goes into a trust where the spouse has lifetime access for their own needs but on their death the remainder follows the intent of the original owner while the other half of the estate is completely under the control of the second partner who can direct it however they want. For example, if the surviving partner remarries, are you comfortable with them directly a significant share of the estate to their partner and step-children?
Also, if you want to be set up to minimize estate taxes (which will invariably change over time) you need to more complicated structure although I think the 2020 version is fairly simple for most people. This is definitely a talk to a lawyer area.
Lawyers will want to use their own boilerplate. Starting the process using someone else's just makes more work for them since they would have to evaluate it or just junk it. Having a clear set of bullet points about your intentions (like the ones above) is a appropriate level of detail.
Remember that the amount in #1 will be in addition to the share in #2 (unless those are different people) so first to die's relatives will get more if #1 is a signficant amount of money. Also, if one sibling dies, then 2/3 goes to your sib and 1/3 to your partner's sib (if no descendants). Is that really what you want or do you want 1/2 to each surviving sib?
posted by metahawk at 1:49 PM on April 23, 2020
Also, if you want to be set up to minimize estate taxes (which will invariably change over time) you need to more complicated structure although I think the 2020 version is fairly simple for most people. This is definitely a talk to a lawyer area.
Lawyers will want to use their own boilerplate. Starting the process using someone else's just makes more work for them since they would have to evaluate it or just junk it. Having a clear set of bullet points about your intentions (like the ones above) is a appropriate level of detail.
Remember that the amount in #1 will be in addition to the share in #2 (unless those are different people) so first to die's relatives will get more if #1 is a signficant amount of money. Also, if one sibling dies, then 2/3 goes to your sib and 1/3 to your partner's sib (if no descendants). Is that really what you want or do you want 1/2 to each surviving sib?
posted by metahawk at 1:49 PM on April 23, 2020
Using a lawyer is HIGHLY recommended, particularly with your level of assets. A lawyer can help with structuring the various accounts so that the plan is comprehensive - not limited to the will. And yes, the lawyer may well recommend a trust, and for several good reasons.
The structure seems well thought out.
The one issue that continually arises involves Pam. You like Pam. You want her to receive, let's say, $50,000 or 4% of your assets. Pam has a husband and two children.
If Pam is not alive when the surviving spouse dies, do you want her husband Ralph to receive the funds, or do you want them to go to her children?
If you simply identify Pam, then her husband (Ralph or maybe some other guy she marries later) will probably receive the bulk of it. If you say "Pam, if she survives me, otherwise to Pam's living children" the husband is out of the loop.
Consider this issue for each beneficiary.
posted by yclipse at 2:22 PM on April 23, 2020
The structure seems well thought out.
The one issue that continually arises involves Pam. You like Pam. You want her to receive, let's say, $50,000 or 4% of your assets. Pam has a husband and two children.
If Pam is not alive when the surviving spouse dies, do you want her husband Ralph to receive the funds, or do you want them to go to her children?
If you simply identify Pam, then her husband (Ralph or maybe some other guy she marries later) will probably receive the bulk of it. If you say "Pam, if she survives me, otherwise to Pam's living children" the husband is out of the loop.
Consider this issue for each beneficiary.
posted by yclipse at 2:22 PM on April 23, 2020
If you simply identify Pam, then her husband (Ralph or maybe some other guy she marries later) will probably receive the bulk of it.
No. Admittedly, state law varies. However, under the common-law rule, if the beneficiary does not outlive the decedent by a minimum period, the bequest "lapses" and becomes part of the general estate of the decedent and will be distributed according to the residuary clause (or according to intestacy rules if there is none). Even in states that have anti-lapse statutes, which I think is the majority now, the bequest will usually lapse unless the heirs of the originally named beneficiary are blood relatives of the original testator. So if Pam is, say, a cousin, her children (or other heirs who are blood relatives of the original testator) would inherit, not her husband. If Pam is just a friend, the bequest will lapse.
posted by praemunire at 6:02 PM on April 23, 2020
No. Admittedly, state law varies. However, under the common-law rule, if the beneficiary does not outlive the decedent by a minimum period, the bequest "lapses" and becomes part of the general estate of the decedent and will be distributed according to the residuary clause (or according to intestacy rules if there is none). Even in states that have anti-lapse statutes, which I think is the majority now, the bequest will usually lapse unless the heirs of the originally named beneficiary are blood relatives of the original testator. So if Pam is, say, a cousin, her children (or other heirs who are blood relatives of the original testator) would inherit, not her husband. If Pam is just a friend, the bequest will lapse.
posted by praemunire at 6:02 PM on April 23, 2020
A trust and estates lawyer is worth his weight in gold. If you do have considerable assets it would be a bargain to pay $2000 (without establishing a trust, which you probably would not need if you hired a good estate attorney) to make sure your wishes are followed. Designating beneficiaries, to investment accounts, for example, will keep them out of probate. Estate attorneys, I find, are the very devil for understanding taxes, and will work like hell to minimize them for your heirs.
An estate attorney might also be able to guide you as to "appropriate" amounts to gift to various relatives. Our attorney did, and we also did a "living will" at the same time. Both cost about $2500 in total fees.
posted by citygirl at 10:12 PM on April 23, 2020
An estate attorney might also be able to guide you as to "appropriate" amounts to gift to various relatives. Our attorney did, and we also did a "living will" at the same time. Both cost about $2500 in total fees.
posted by citygirl at 10:12 PM on April 23, 2020
When in a former life, I advised clients on estates and wills, my suggestion was to focus on the assets and income that my clients had and what they wanted done with those assets and income. Depending on the nature of the asset, a particular ownership structure might be more suitable, and potentially, not even be part of the will.
Eg. a client bought an insurance policy for the benefit of a relative - the value of the policy would go up over time, and it did not need to be part of the will as the policy stated who the beneficiary was. Shares may be better held in a pension/401(k) fund. The house you live in is owned as joint tenants, NOT tenants in common, so that there is a right of survivorship and ownership passes on death, without the need for probate.
Major issue is that a "one size fits all"/"standard precedent" is the usual approach with most lawyers, but the standard precedents tend to be fairly robust.
posted by Barbara Spitzer at 1:13 AM on April 25, 2020
Eg. a client bought an insurance policy for the benefit of a relative - the value of the policy would go up over time, and it did not need to be part of the will as the policy stated who the beneficiary was. Shares may be better held in a pension/401(k) fund. The house you live in is owned as joint tenants, NOT tenants in common, so that there is a right of survivorship and ownership passes on death, without the need for probate.
Major issue is that a "one size fits all"/"standard precedent" is the usual approach with most lawyers, but the standard precedents tend to be fairly robust.
posted by Barbara Spitzer at 1:13 AM on April 25, 2020
This thread is closed to new comments.
posted by effluvia at 8:24 AM on April 23, 2020 [2 favorites]