It astounds me that people, till this day, choose to let the State determine who will receive their assets at the time of their death.
My former law partner recently worked on a case that involved an unmarried man, who was very close to two of his cousins (by all accounts, the only people in the world who cared for him).
TheA�man passed away without filing a Will or Testament.
So what happened?
His estate was passed to 14 of his cousins (not just the two with whom he was close to) PLUS two of his aunts living in Italy WHO HE NEVER ACTUALLY MET!
And this was only after a lot of time, effort and money spent, searching and proving who his relatives were.
In other words, his estate passed by intestacy a�� the laws of the State of Georgia determined who would inherit what was left and at what percentage, because this man failed to write a will.
But there are even less obvious situations where the failure to write a will has unexpected, and undesirable, consequences.
Suppose a man dies in New York, and he has a spouse and two children, the estate does not automatically pass to the surviving spouse.
Instead, the surviving spouse will receive the first $50,000, plus A? of the remainder of the estate; and the two children will each receive A? of what is left.
This precludes good tax planning.
Without a will on file,A�you risk the assets (including real property) going directly to children, who may be too young, irresponsible, or suffer from addictions or creditor problems to handle their new-found money responsibility.
In short, without a will, youA�may have a complete mess, and not have the people whom you want to benefit…benefit form your passing.
While property, like bank accounts with beneficiary designations, life insurance with named beneficiaries, and real estate owned by husbands and wives will not be affected by a will (or the failure to write one), usually a person has enough assets that do not pass by operation of law for the default of intestacy to be inappropriate and undesirable in most cases.
At the very least, you owe it to yourselves and your family to sit down with an estate planning professional and see whether intestacy… plus your beneficiary designations…will suffice. In almost every case, it will not.
And remember, if you have minor children, you should have a will filedA�with appointed guardians for your children, in the event you and your spouse pass away before they turn 18.
If you yourself do not choose a guardian for your children, you can almost be assured that members of your own family will fight over your assets, creating an emotional and financial turmoil for your children at the worst possible time.
Until next time,
Doug Davenport, J.D.
Douglas Davenport, J.D. is the Former President and Chief Investment Officer for Atlanta Investment Counsel, LLD, an investment advisory firm.A� He is also a member of the State Bar of Georgia and the Fiduciary Law section of the state bar.