Wills Assure Assets are Distributed Properly

By: Wells Marble & Hurst, PLLC
www.wellsmar.com

• Survey: 58% of Americans do not have a basic will

by Nell Luter Floyd

Months before their first child was born, Bethany and John Harless of Madison had an attorney draw up a basic will.

"It seemed like when we had a kid it was time to be a grownup and have a will," said Bethany Harless, 38, a Realtor. "I'd been to financial planning seminars and they always recommended that you have a will."

The Harlesses had owned a house jointly for several years before their first child, 3-year-old Culley, was born but had not taken time to draw up a will, she said.

Unlike the Harlesses, not all adults take the time to have a will drawn, said R. David Marchetti, a Jackson attorney with Wells Marble & Hurst.

"A lot of it is just normal, everyday procrastination," he said. "Some of it is a psychological barrier because it's associated with death and dying and people don't want to think about it."

Fifty-eight percent of Americans lack a basic will, the first document generally considered in an individual's estate plan, according to a survey from lawyers.com, a free, online database of 440,000 lawyers from legal publishers LexisNexis Martindale-Hubbell.

In 2004, only about 42 percent of adults had a will, down from 47 percent in 2000, according to the survey. Twenty-one percent of Americans without an estate plan say they lack sufficient assets, while 15 percent say they're not old enough, according to the survey.

A will is recommended for anyone, single or married, who has assets that he or she would like to determine their outcome after death.

"In Mississippi, if you die without a will and you have a wife and children your wife would receive a child's share of the estate," Marchetti said. For example, if a married man died without a will and left a wife and three children, the wife would receive one-fourth of the estate, the same as each child.

A will also gives a person an opportunity to choose an executor, the person who will be in charge of gathering assets, paying debts and distributing assets.

The cost of having a will prepared by a lawyer varies, with the cost rising depending upon how complicated one's estate may be, Marchetti said. Some lawyers will prepare a basic will for $200 for a couple, but the fee could be less if you shop around or have an established relationship with an attorney.

"A lot of times a lawyer makes more money cleaning up the mess caused by a badly drawn document," Marchetti said.

In Mississippi, a handwritten will is acceptable as long as it's all in the author's handwriting, doesn't include anyone else's handwriting and the author signed it at the bottom.

"A handwritten will can be probated in Mississippi," Marchetti said. "You have to prove the handwriting."

Handwritten wills, also known as holographic wills, are more common that one might think, he said.

"A lot of elderly people we find have holographic wills," he said. "Kind of eccentric people."

You can secure a form off the Internet to complete as a will, but you cannot be positive it complies with Mississippi law, said Jody Varner, a Jackson attorney with Brunini Grantham Grower & Hewes.

There is a chance you could find on the Internet the proper form for a will depending upon the state where you live, but you would lack the knowledge and advice of a lawyer.

"Just because you get it off the Internet doesn't mean it's valid," Varner said.

In addition to determining the outcome of one's assets, a will gives a parent an opportunity to name a legal guardian for children. "You don't want to leave that to chance," Marchetti said.

Varner recommends the creation of a trust within a will to clients who plan on leaving to a child a sizeable amount of money — typically the proceeds from at least $100,000 in life insurance. That way the child doesn't automatically inherit the money at age 21 when he or she may lack judgment about how to manage money and squander it.

A trust can be set up to provide for the child's health, education and other needs before the trust assets are ultimately distributed. The parent can decide when the will is being written at which ages the trust assets are ultimately distributed.

"For example, some clients like to make the distribution so it is one-third at age 30, one-third at age 35 and one-third at age 40," Varner said.

Trusts are especially recommended for special-needs children, Varner said. "Some children, by definition, can't handle money," he said.

It's a good idea to review one's will every three to five years or if one's circumstances change because of marriage, divorce, the birth of children or grandchildren, an increase or decrease in wealth, a sizeable inheritance, the purchase or sale of real estate or a business or the death of a beneficiary, Marchetti said.

"Some people change their wills quite frequently, depending upon who came to see them last and how they're being treated," Marchetti said. "A lot of people don't change theirs."

Ann and Jim Jensen of Jackson, who are both age 70 and Realtors, spent $500 to update their will in the late 1990s after their three daughters were grown.

"We had a will when the children were quite young," said Ann Jensen. "We did that so if anything happened to us the girls would be taken care of. We went along, they grew up and we didn't think about it. About five years ago, we realized we needed a new will. We don't want our children to have to go through any more grief than they have to."

Marchetti keeps copies of each will he prepares and advises clients to keep a copy of their will in a fireproof safe or bank deposit box. If an individual stores a will in a bank safe deposit box, he must set it up before he dies to give someone access after his death. "Otherwise you have to get a court order to get into the box," he said.

From the Clarion-Ledger, June 20, 2004.

Wells Marble & Hurst, PLLC
P. O. Box 131
Jackson, MS 39205-0131
(601) 605-6900