Draft the Script

The title screen fades to the establishing shot with the camera positioned low to the ground. Raindrops plunge into a puddle on the asphalt. A couple walks by, visible only from the knees down, water jumping with each slap of their soles. The camera follows as they enter a building, then cuts to them emerging from the elevator. The man tries an office door—locked. A woman inside looks up when she hears the door rattle, then hurries to disengage the bolt and usher the couple inside.

If this scene were part of a black-and-white movie, we would expect a suspense-filled story to follow. Life and death issues surely would fill the screen and linger in the minds of the viewers long after the final credits rolled.

But it wasn’t a movie. On a recent wet and gray Midwest morning, my wife, Judi, and I went to see our attorney to have new wills prepared. Our previous wills were woefully outdated. Unlike some people who see any discussion of death as a horror film, on that morning we freely talked about our wishes should Judi and/or I die today.

If a person dies but has not made his or her wishes known in a last will and testament, the court will follow state law in transferring property to a new owner. Very likely, the state formula would not be exactly as the deceased would choose. Judi and I, for example, will include charitable giving in our estate plan. If we died without a will, that desire would not be fulfilled by merely following state law. Of greater concern for parents with minor children, is the naming of a guardian should both parents die prematurely. The court will choose a guardian. It is essential that everyone create a will and not leave the disposition of their estate and their children to the logic of state law.

Probate is the court process to transfer assets. Since probate is a long, slow procedure that is complicated, costly, and part of the public record, it is advantageous to set things up as non-probate property as much as possible.

Non-probate property takes many forms. The way ownership is recorded could transfer property outside of probate. A house or investment account registered as a joint tenancy with rights of survivorship automatically transfers to the survivor.

Accounts with stated beneficiaries, such as life insurance policies and retirement accounts, will transfer assets outside of probate. In our current review, Judi and I will confirm that we have properly named primary and secondary beneficiaries. Transfer on death (TOD) or pay on death (POD) registration is another way to transfer property, securities, or funds in bank accounts. Beneficiaries will provide a death certificate and transfer instructions to settle either a TOD or POD.

Even for a person who maximizes non-probate transfers of property, a will is still necessary for all residual property. A personal representative (or executor) is named in the will to serve on behalf of the deceased. Specific items can be given to certain persons through the will. A general bequest is paid out of assets, either as a percentage of the estate or a specific dollar amount. Judi and I have both specific and general bequests in our wills.

I’m a do-it-yourself kind of guy, and I’ve looked at software that guides a person through the creation of a will. I’ve come to the conclusion, however, that this is one area where the expertise of an attorney is essential.

This probably will not be the last time Judi and I do this. Within the next decade, we will stop working for a salary. That will likely involve a change of residency along with the change of life context. Those changes will require a new will to replace the one just prepared. Until then, however, we’ve got the script drafted.

Originally published by Pensions & Benefits USA.