Whew. We made it to September, and got past National Make a Will Month. And you didn’t get your will written or updated. While you’re feeling guilty about that, we’re going to take a minute to debunk some common myths about wills. It won’t help you feel better, but it might help you better understand estate planning.
Herewith some of our favorite (and most commonly heard) myths about wills:
Myth #1: you need a will to avoid probate
Avoiding probate is important to many people, and most of our clients. It is practically an article of faith — though most people don’t really know what “probate” entails, how important it really is to avoid it or how to do so.
But here’s the most common myth about wills: writing a will (by itself) will not avoid probate on your death. In fact, your will is just instructions to the judge in the probate proceeding.
So how do we know if your estate will need to go through the probate process? It’s actually pretty simple: if there are assets in your name (no joint tenant, no beneficiary designation, not trust titling) there’s only one way to get them to your successors. That way is called probate.
Now, in Arizona there is a simple mechanism for getting property transferred without probate. But it’s only available for personal property worth less than a total of $75,000.
Can you avoid probate and also have a will? Yes. let’s visit our second myth about wills.
Myth #2: if you do have a will, your estate has to go through probate
Once in a while we talk with a client who wants to avoid probate, has a trust and beneficiary designations, but refuses to sign a will. They think that having a will means that their heirs must file a probate.
Not true. In fact, every client of ours who executes a living trust in order to avoid probate will also have a will. That will is usually what’s called a “pour over” will. And it doesn’t require any probate at all.
Then why do it? It’s what lawyers always refer to as “belt and suspenders” — a phrase that we cling to even as it becomes meaningless to new generations. What if you forgot to transfer an asset into the trust’s name? Or an asset fell out of the trust (like when you refinance your mortgage after the rates come back down, or you move bank accounts in search of higher interest rates)? That’s when the pour over will comes into play — it doesn’t avoid probate, but it gets the assets back into the trust’s name.
Myth #3: if you want to disinherit someone, you have to leave them $1
No! No! Don’t do that!
If you want to disinherit someone, you can do it by — and this is going to seem too easy — saying “I leave nothing to my son David.” Want to turn the knife a little? You can say “I leave nothing to my son David because he’s a worthless human being” (sorry to all the Davids out there — we don’t mean to impugn you).
If you leave David $1, or a piece of furniture, or anything else, he’s a beneficiary of your estate. That means he has to get notice, sign a receipt and participate. Leaving him a nominal inheritance just mucks up the probate process. And it doesn’t stop him from contesting your will if he wants to argue that you were incompetent, or unduly influenced by his sister, or whatever.
You might, however, want to leave David more than a nominal amount. If you leave him, say, $10,000 and include what’s called an “in terrorem” provision, he has to weigh the odds. Would his contest of the will likely succeed? Probably not. But if he doesn’t object, he gets at least a little bit of an inheritance. So maybe he’ll be discouraged from objecting/contesting.
Truth is, though, that if you have a will that simply disinherits David, he probably can’t successfully contest it. Especially if it was prepared by a professional who knows how to avoid common errors in will drafting. There’s a name for that person: she’s called a “lawyer.”
Myth #4: people are out there just waiting to contest your will
Nope. Will contests are rare, and successful will contests are vanishingly rare.
And your brother, or your aunt, cannot file a will contest at all — unless they have an interest in your estate. If you have children, or a spouse, or parents, then your brother and your aunt are not going to receive anything from your estate even if your will is invalid. So they almost certainly lack “standing” to contest your will. That means the probate judge will throw out their imaginary contests (because, again, they are not going to actually contest your will) summarily.
Also, no one gets to contest your will just because they think it’s unfair. You want to be unfair with your will? Go for it! We’ll help you! There is no requirement that you be fair, or follow up on promises people imagine your parents made twenty years ago, or keep assets in the family bloodline. Under Arizona law, you can leave everything to charity, or your girlfriend, or your lawyer! (Just kidding about the lawyer — you can’t leave us anything).
This is the easiest myth about wills to debunk, actually. People who watch movies or read books get a very skewed vision about how frequent will contests actually are.
Myth #5: you need a lawyer to write your will
Let us be careful, and clear, as we debunk this common myth about wills. You can write your own will. In Arizona (but not in every state) you can even write what’s called a “holographic” will — in your handwriting, and without witnesses. But please don’t.
Why not? Aren’t we just trying to protect our own business interests when we tell you to use a lawyer?
Arguably, we lawyers will all get wealthier if you write your own will. That’s because lawyers so often undercharge for will writing, and the litigation from a failed self-written will is so often terrifically expensive. And people make mistakes when they try to prepare their own wills.
We’re not protecting our turf so much as hoping you get what you want. And we also want you to get good advice about what you think you want — which might not be what would accomplish your wishes. Because we actually have both knowledge and experience about how estate plans actually work in the real world. And we add value to the will preparation process.
Did we hit your favorite myth about wills? Feel free to offer up other myths for us to debunk — or maybe confirm! And one day soon we’ll tackle favorite myths about trusts, or about nursing home costs, or — well, who knows?
