Ready to Write Your Will? Experts Recommend Several Dos and Don’ts

A properly written will can be an important first step in the estate planning process. Learn some of the “dos and don’ts.”

Print
https://tickertapecdn.tdameritrade.com/assets/images/pages/md/
4 min read

Along with death and taxes, there seems to be a third certainty for Americans: a reluctance to think about, talk about, and properly and legally prepare for the inevitability of the first item.

Composing your will, which can be a first step in the estate planning process, may not be high on the list of conversation topics for family dinner—and recent research indicates a majority of Americans don’t have one. Just 44% of U.S. adults reported having a will, according to a May 2016 Gallup poll (conducted shortly after the death of the musician Prince, who reportedly died without having a will). That figure was down from 51% in 2005.

Whatever your profession or income, a properly written will should accomplish a number of important aims: 

  • Name a representative to administer your estate  
  • Ensure your wishes for transferring your assets are carried out smoothly  
  • Ensure any minor children or dependents are cared for
  • Perhaps the most important goal—avoid family strife

“Families can get tortured over estate controversies and inadequate planning,” says David J. Dietrich, chair of the American Bar Association’s Section of Real Property, Trust and Estate Law. “You don’t want to leave it to chance.”

Here are some of the “dos” and “don’ts” experts recommend when writing a will.

DO know what a will does and does NOT do

Wills “do certain things very well,” says Dietrich, such as designate who’s in charge—an executor, trustee, or other representative. However, there are still possible gaps, and a will should be considered within the broader context of estate planning. A will does not govern the transfer of certain types of assets, known as “nonprobate property,” which includes real estate and retirement accounts.

DO address houses, land, and other real estate

Without specific instructions in a will, real estate and other assets owned with “rights of survivorship” pass automatically to the surviving owner, according to the American Bar Association. Often, real estate gets transferred to children equally as “tenants in common,” which has potential to open a can of worms, Dietrich says. If none of the children is designated “first option holder,” any of them could force a sale of the property, with the proceeds then divided among them. One possible option is to grant one of the kids an option to buy out the others at fair market value.

DON’T forget about brokerage accounts, IRAs, and other retirement accounts

Even well-intentioned, well-crafted wills can fall short if these accounts (and the beneficiaries) aren’t addressed. It’s “one of the biggest issues in American estate planning,” Dietrich says. “We’re talking about trillions of dollars.” A will should be drafted with thorough, complete disclosure of financial products, and the beneficiary designations.

DO take care of the kids (and address additional spouses/partners)

If you have children under age 18 or any adult dependents, specify a guardian and/or trustee for them if you die and you were the last living parent. Also, if you’ve had more than one spouse, be sure to specify their role in the distribution of your assets.

DON’T forget your geography

A will must be signed and notarized in accordance with state law, and, if done correctly, should remain valid even if you’ve moved to a different state, Dietrich says. Still, it’s a good idea to ask your attorney or advisor, or educate yourself, on how inheritance taxes and other estate-related laws vary from state to state.

Download PDF: Quick Start Guide to Estate Planning

DON’T worry about the cost of drawing up a will

The 2016 Gallup poll indicated that the wealthier people are, the more likely they are to have a will. Of Americans whose annual household income is $75,000 or greater, 55% said they had a will, compared with 31% of those with incomes under $30,000, according to Gallup.

Money shouldn’t be an object. Nonprofit organizations are available in many states to help draft a will at little to no charge, according to AARP. Additionally, do-it-yourself online services have grown in recent years, although legal experts caution that such DIY options may not fully address a person’s needs. “If you want to avoid controversy, do it with a professional,” Dietrich says.

DO remember it’s not just about the money

Who gets your rare painting or baseball card? Personal items that are difficult or impossible to divide up often trigger contentious estate disputes, Dietrich says. “It’s rarely the cash” that causes tension between heirs, he says. “A poorly written will might not address how to split up the tangible personal property, like art or collectibles.”

DO talk with loved ones and DON’T drag your feet

Enjoy yourself—but as the old song goes, remember it’s later than you think. If you don’t have a will, it’s probably time to get moving on it. There isn’t really an “ideal” age to write a will, Dietrich says, but if you’re in a committed relationship and considering having children (or you already do), a will is a good idea. Ultimately, you want to make your intents clear and legally binding, and help your family avoid disputes after you’re gone. And like a lot of things, good communication can go a long way.

Call Us
800-454-9272

TD Ameritrade does not provide legal or tax advice. We suggest you consult with a legal or tax-planning professional with regard to your personal circumstances.

TD Ameritrade and all third parties mentioned are separate and unaffiliated companies, and are not responsible for each other’s policies or services.

adChoicesAdChoices

Market volatility, volume, and system availability may delay account access and trade executions.

Past performance of a security or strategy does not guarantee future results or success.

Options are not suitable for all investors as the special risks inherent to options trading may expose investors to potentially rapid and substantial losses. Options trading subject to TD Ameritrade review and approval. Please read Characteristics and Risks of Standardized Options before investing in options.

Supporting documentation for any claims, comparisons, statistics, or other technical data will be supplied upon request.

The information is not intended to be investment advice or construed as a recommendation or endorsement of any particular investment or investment strategy, and is for illustrative purposes only. Be sure to understand all risks involved with each strategy, including commission costs, before attempting to place any trade. Clients must consider all relevant risk factors, including their own personal financial situations, before trading.

This is not an offer or solicitation in any jurisdiction where we are not authorized to do business or where such offer or solicitation would be contrary to the local laws and regulations of that jurisdiction, including, but not limited to persons residing in Australia, Canada, Hong Kong, Japan, Saudi Arabia, Singapore, UK, and the countries of the European Union.

TD Ameritrade, Inc., member FINRA/SIPC. TD Ameritrade is a trademark jointly owned by TD Ameritrade IP Company, Inc. and The Toronto-Dominion Bank. © 2018 TD Ameritrade.

Scroll to Top