Question: I don’t have a Will but I want my spouse and kids to inherit everything. If my spouse and kids will inherit everything anyway, what’s the point of making a Will?
Answer: That’s a good question. In certain circumstances, a person’s spouse and kids will inherit everything. However, that may or may not apply to your particular situation. And if it doesn’t, it probably won’t happen like you want it to. Each state has a set of laws that will “create” a distribution plan for your assets if you don’t do so yourself. Those laws are called the laws of intestate succession. Under Arizona’s laws of intestate succession, your spouse and kids may inherit all of your assets. If your surviving spouse is also the parent of ALL of your children, your spouse would get your entire estate. But if you have a blended family, that changes everything. A blended family includes a family that has children that are the children of one spouse, but not the other. This is a huge segment of the population as 50-60% of all first marriages end in divorce, 75% of divorcees remarry and 65% of those who remarry have children from their previous marriage.
If you have children that are not also children of your surviving spouse, only half of your separate property will pass to your surviving spouse. The other half of your separate property and your entire 1/2 interest in the community property will pass to your children. Community property is all property acquired during a marriage, except by gift or inheritance. Since most married Arizona couples own the bulk of their property as community property, this could cause big problems for your spouse. Half of your spouse’s assets (your half of the community property) will go to your children instead of staying with your spouse. This could cause serious financial problems for your spouse. Also, step-children are not provided for in Arizona’s laws of intestate succession. If you want your step-children to inherit any part of your estate, you must create a Will or Trust that names your step-children. Otherwise, if you rely on the laws of intestate succession, your step-children will inherit nothing. As you can see, blended families are a big example of why not making a Will is a big no-no.
In addition, a Will doesn’t just state your distribution plan of who should get what property when you die. It also serves the essential function of appointing a guardian for your minor children. Minor children are all children under the age of 18. If something happens to you while your children are under the age of 18, a guardian will step in and raise the children just like a parent would. This includes providing for the children’s care, education, medical needs and supervision. And in Arizona, a Will is the ONLY place you can name a guardian for your minor children. It’s a good idea to pick a guardian even though you would want your spouse to raise your children. In the event of an accident involving both you and your spouse, it is best if your choice is already in place. If you don’t name a guardian, the court will name one for you. However, the court may or may not name the person you would have wanted. And, your loved ones may fight over who should raise your children – causing stress on your family during a difficult time.
If you want your assets to pass to your minor children, someone will have to manage those assets until the children turn 18. This person is called a conservator. A conservator will collect all assets belonging to the minor children, manage those assets and use those assets to pay for the children’s care, support and education. It can be the same person you choose as the guardian for your children, but it doesn’t have to be. For example, your sister might be great with kids but horrible with money. Naming a conservator will ensure that the best person is watching the assets you wanted to give to your children. If you don’t name someone, the court will pick someone for you. However, you can’t count on the court picking someone that you would approve of. The only way to ensure that the right person is managing your children’s assets is to pick the conservator yourself.
Finally, a Will also names the person you want to administer your estate, called a personal representative (or executor in some states). Your personal representative is responsible for gathering your assets, opening a probate, paying any creditors, filing your last tax return and distributing your assets to your heirs. This is an important role as your personal representative is the person that makes sure everything is done the way it should be. Without a Will, you won’t have any input on who this person should be.
If you have questions about whether or not you need a Will, call Arizona estate planning lawyer Abigail Neal with your questions.