Taking Care of Mom and Dad: If Your Parents Die Without a Will
Some people -- even some with considerable assets -- remain cynical about what happens with their money and possessions after they die. They avoid making wills because they fear death...or don't want to "waste" time thinking about things that happen after they're gone.
This may be the best choice for a specific person, but it makes trouble for the people he or she leaves behind.
If your parents die intestate (without a will), the court will choose the person responsible for wrapping up your affairs. This person is called an administrator, and might not be the person your parents would have wanted. Often, a neutral lawyer is appointed and must be paid with estate funds.
A neutral lawyer being paid with estate funds may not be in any hurry to get things resolved.
A key point to remember: Probate is designed to prevent fraud or abuse. It's not designed for efficiency or protection of wealth.
A quick way to consider probate is to look at what happens under different family circumstances. Here are the ground rules if the person who dies without a will is:
- Married with children. The law inmost states awards only a third to a half of the dead person's property to the surviving spouse and the remainder to the children, regardless of their age.
- Married with no children. Most states give only a third to a half of the estate to the survivor. The remainder generally goes to the dead person's parent(s), if they're alive. If both parents are dead, many states split the remainder among the dead person's brothers and sisters.
- Single with children. State laws uniformly provide that the entire estate goes to the children.
- Single with no children. Most state laws favor the dead person's parent(s) in the distribution of property. If both parents are deceased, many states divide the property among the brothers and sisters.
There are some good reasons for these statutory distributions. If there is a will, the surviving spouse can usually renounce it and instead opt to take the share of the estate provided by state law. This is a legal device historically intended for the protection of the survivor.
If a husband holds the title to the property himself and writes a will directing it to his children by a previous marriage, the second wife can file a petition in probate court to take her share of the estate.
In most cases, probate proceedings diminish family wealth. Even the simplest will can prevent...or at least minimize...the damage.
A will is a decision-making device, forcing the maker to see that it becomes a precise legal tool that no one can argue with, dispute or change easily.
There are two ways in which your parents can write a will: with an attorney or by themselves. If they write the will themselves, there are several ways to proceed: they can use a will kit or software that includes standard forms...or, they can scrawl their thoughts on a scrap of paper (in legal terms, this is called a "holographic will").
Courts sometimes recognize poorly scrawled wills, while tossing out carefully crafted lawyer's work. But, the scrap of paper approach is easier for angry people to challenge, so it's not a good idea if your parents are leaving people anything substantial.
So, the best way to make sure that things end up where your parents want them is to make a will. Beyond that, it's hard to generalize. But, some of the necessary items in an effective will include:
- your parents' full names and principal residence, stated clearly;
- the date;
- a declaration that the document is a will;
- the names of their executor and substitute executor;
- the names of guardians and successor guardians for children or disabled people in their care;
- a list of their assets and a list of major debts or liabilities;
- a list of established trusts, including names of trustees and successor trustees;
- a list of life insurance policies;
- instructions for which funds should be used...or assets sold...to pay estate taxes and other costs;
- a list of gifts made from the estate, the complete name of each recipient and some description of his or her connection to or relationship with your parents;
- where they want to have their funerals, burials, cremations, etc. -- or whether they don't want these ceremonies at all;
- their signatures, made in the presence of at least two witnesses with their names attached to the document.
