Property is one thing. Do you also have a message to pass on to your heirs? Ethical wills are a simple but often overlooked opportunity in estate planning. An ethical will can be a powerful tool for shaping your legacy and creating peace of mind.
Financial estates can divide families and have unintended consequences that run counter to the giver's wishes. Anyone who wants to pass along a message of love, values, or other information should write an ethical will. Although an ethical will is not legally binding, it will be read during a sensitive time in your family's life, and that could give your words extra weight.
Your Final Two Cents
An ethical will can be an important addition to your legal will that imparts your values, not your assets. "The legal documents of your estate plan cannot adequately communicate your hopes and vision for how your successors will build upon your legacy. An ethical will is an opportunity to more fully impart your wishes, your priorities, and your values. It can also serve as a final goodbye, and a chance to communicate your love, wisdom, treasured moments, and even your regrets," says Sarah Newcomb, behavioral economist at Morningstar.
An ethical will can also help prevent family tensions and strife following a passing. "Recently, I spoke with a man who is in the process of estate planning. He was struggling with the terms of a trust fund he wanted to create because he wanted his money to benefit his daughter and grandson, but there was a deep conflict between him and his son-in-law in terms of values and priorities. He worried that if the terms of the trust were not strict enough, the money might fall into the hands of his son-in-law and be wasted," Newcomb says.
In situations where estate planning exposes a minefield of interpersonal difficulties, ethical wills can help by providing context and explanations for the decisions that you make in your legal documents, Newcomb explains.
What Goes In
Many people also use their ethical wills to pass on personal messages of love and parting. Newcomb highlights possible themes you may want to include:
- Instructions for how you want to be buried, honored, or remembered
- Life lessons
- Regrets, and how to avoid them or what you hope your loved ones would do differently
- Stories you hope will be told and retold to younger generations
- Explanations for why specific decisions were made in the legal will or terms of trusts
- Apologies or confessions that you are unable to make otherwise
An ethical will helps you to guide and share messages with your loved ones. It can also offer you the valuable gift of reflecting and sharing about your life in a unique way. "There can be immediate, personal benefits to writing an ethical will, too. Many people say that they experience a sense of healing, catharsis, or peace of mind when they write their ethical will," Newcomb says.
Think about the things that are important to you but that you cannot, through legal means, compel your loved ones to do or consider. What would you like them to know about your values, your life, and your legacy that you might not otherwise have the opportunity to say?
The ethical will can be short, even just half a page, or as long as you want it to be. You can even create it in video form. It can be a work in progress that you can add to throughout the years. Sign it, date it, and keep your ethical will with your financial will.