What is an estate?

An estate is a collection of all your business and personal assets such as commercial real estate, equipment,homes, cars, furniture, books, artwork, jewelry, stocks, etc.

What is a will?

A will is a legal document created by an individual or couple to specify what you would like to happen to your business and personal assets when you die. A will is often called a last will and testament. The creator of the will is called a testator. Those you assign to receive various assets are called beneficiaries. Your beneficiaries could be individuals or organizations such as a church, college, or charity.

If you do not have a will when you die, your assets will be distributed according to state law. Creating a will ensures that your assets go to the people and organizations you would like instead of the individuals the state would like.

How do I create a will?

To create a will, you must be over 18 years old and be in a sound state of mind. You can make a will with or without the assistance of an attorney. The requirements for a will to be binding vary from state to state but generally these are the requirements:

You must identify yourself as the creator of the will. You can do this by writing, “Last Will and Testament of (and then inserting your Name)” on the top of the document.

You should state in the will that you revoke all previous wills.

You should state that you are of a sound mind and that you have the capability of deciding what you want done with your assets and that you are doing so freely and willingly.

You must specify an executor. An executor is the individual you choose to follow the instructions in your will when you die. The executor of your will ensures your assets are distributed according to your wishes outlined in your will. Your executor is typically a trusted family member or friend.

You state who you would like to receive your assets (beneficiaries) and the specific assets you would like each beneficiary to receive upon your death.

If you have minor children, you will specify who you want to raise and care for your children. If you die without specifying in a will who you would like to care for your minor children, a judge will decide for you. Having a will is vital to ensuring that you decide who will care for you children upon your death.

You must sign and date your will in the presence of at least two witnesses. These witnesses have to be disinterested persons, which means they cannot be beneficiaries of the will. Some states require that the will be notarized as well as signed by witnesses. Your signature and the signatures of the witnesses should be placed at the end of the will as any text following the signatures will be ignored.

Should I create a living trust instead of a will?

If you only have a will, your estate will go through probate. Probate is a court-supervised process of distributing a deceased person’s assets. One of the primary functions of probate is to carry out the provisions of a will. If you want to avoid the cost and time of probate, you will need to set up a living trust. A living trust works like a will in that it specifies where you would like your assets to go upon you death, but a living trust does not require a probate proceeding.