Estate planning is the process of arranging for your property to go to your family, friends, and organizations, instead of being used to pay probate fees and inheritance taxes. Because your assets and wishes change as you grow older, estate planning isn't something you do once in your life and then forget it; it must be an ongoing process.
When you're young and healthy, all you may need is a simple will and perhaps a life insurance policy. It's probably not worth the trouble to worry about avoiding probate or federal death taxes.
When you are in your fifties or sixties, your concerns begin to change. You probably have more property and want to ensure that the people who inherit it don't have to pay large probate fees or taxes. It's worth spending some time choosing and implementing a sound estate plan that will keep these costs as low as possible. Here are some strategies you may want to pursue.
You also need to use a will to name an executor--someone to wind up your affairs after your death. And if you want to disinherit a child, who might otherwise be entitled by law to a share of your estate, you must use a will.
Everyone who has any resources at all needs a will. Even if all of your possessions are in joint tenancy with right of survivorship, some institutions will ask for a will when a death occurs. Many lawyers will prepare a simple will for around $100, perhaps in hope that the low price may bring you back to them for other business.
Another way of having a simple will prepared is to join a legal services group that provides consultation and simple procedures for a monthly payment. Most of them include a simple will as one of the free services they provide without additional cost over the monthly payment.
Still another way of writing a will is to purchase a form that is appropriate for your state. Will kits are sold with complete instructions on how to prepare them and appropriate procedures for having them witnessed. Attorneys warn about such documents, but it is hard to tell where their professional opinion may conflict with their interest in having your business. Certainly wills prepared by attorneys are not immune from challenge in the courts. Still another source of assistance is in some of the computer programs that are now available through software companies. Attorneys would again warn you about the lack of individualization in such a method. However, many legal firms are using such programs themselves and they are written in such a way that personal data are requested so that the will prepared by the software reflects those particular things about the person for whom the will is being written.
For those with access to a computer, Nolo Press offers a software program called WillMaker 6. It makes the job easy, leading you step-by-step in a question and answer format. Once you've gone through the program, you print out the will and sign it in front of witnesses. It comes with a manual providing an overview of probate avoidance and tax planning techniques. It is good in all states but Louisiana. Their address is: Nolo Press, 950 Parker Street, Berkeley, CA 94710.