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A Cautionary Tale: What Can Happen If You Don’t Have a Will

by | Jan 12, 2021 | Features, finances, Life

Tony Hsieh was a wealthy tech entrepreneur who had it all. Million-dollar homes in Utah and Nevada. Tons of cash in the bank. Fame and relationships with world business leaders.

The only thing that he didn’t have when he died was a will. It’s hard to believe that a man with dozens of businesses, properties and financial obligations didn’t have an estate plan.

Mr. Hsieh was a healthy 46-year-old man. It’s likely that he thought he had plenty of time to get his affairs in order. Sadly, he died unexpectedly of smoke inhalation from a house fire.

Since he didn’t have an estate plan, his brother and father had to file an emergency petition with the court. Now, they must pay a team of lawyers to sort through the assets that Mr. Hsieh left behind.

Estate Planning by the Numbers

Making an estate plan isn’t as fun as planning a trip to the Bahamas. However, it is one of the most important things you can do for your family. Having an estate plan in place can provide peace of mind during a difficult time.

While it may be surprising that Mr. Hsieh didn’t have a will, he isn’t alone. In the United States, nearly 55% of Americans die without making an estate plan. Here are other estate planning statistics for you to consider.

  • 71.6% of Americans do not have an up-to-date will
  • 32% of older Americans have not informed their families about important financial, legal and medical documents.
  • Only 48% of Americans have a designated financial power of attorney

For many people, the thought of making a will can be overwhelming. After all, creating an estate plan can bring up difficult emotions that most people would rather not face.

Benefits of Having an Estate Plan

It’s a wise choice to have an updated will in place at the time of your death. Consider the benefits of having an estate plan.

Making a will gives you the opportunity to select your beneficiaries. It lets you name a guardian and provide financial support for your children. By drafting a will, you can:

  • Select an executor of your estate.
  • Make your burial arrangements.
  • Distribute your assets according to your wishes.
  • Change or revoke your will at any time.

What Can Happen If You Don’t Have a Will?

An estate plan puts you in control of your assets. Without one, your state’s laws determine how your assets are divided. Typically, state laws favor blood relatives, children and spouses. Unmarried partners and charities can’t inherit your assets unless they’re in your will.

There are important tax benefits of having a will. Your surviving spouse can benefit from the marital deduction. This allows your spouse to inherit a tax-free estate.

Making a will isn’t just for married couples with children. Single individuals without children can benefit from creating a will. Without one, it’s likely that your parents will be the beneficiaries of your estate.

As a parent, your primary concern is who will take care of your underage children if you die? The state will appoint a guardian if you die without a will. That’s why it’s important to draft a will that designates a guardian for your children.

The good news is creating an estate plan doesn’t require a significant investment of time or money. You can make a will using online software. Since it’s so simple, why not put it on the top of your list of things to do in 2021?

Want to learn more about the importance of making a will? Explore the following resources.

  • Estate Planning Basics by Dennis Clifford
  • Get It Together – Organize Your Records So Your Family Won’t Have To by Melanie Cullen and Shae Irving
  • Special Needs Trusts by Kevin Urbatsch and Michele Fuller-Urbatsch
  • Estate Planning Basics by Denis Clifford
  • Will & Estate Planning by Suze Orman

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