Creating a last will and testament is one of the cornerstones of estate planning. Not only does it allow you to control how your estate is handled and distributed, but it saves money. How?
Quite simply, it is more expensive, as well as time consuming, to settle an intestate estate, one without a will, than to probate a will. When a will is drafted, an Executor is named to administer the estate. The Executor’s duties normally are entrusted to a family member or close friend. While the Probate Court monitors the administration of the Estate, the Executor may not be required to post a security deposit or bond to guarantee their performance if you say so in your will. That provision alone will save your family money.
On the other hand, should you die with no will, a Probate Court appoints an estate Executor. That person will be required to post a bond, and the expense is paid by the estate. In many cases, this bond costs more than having a will prepared.
This bond is required as an Executor has the duty of a fiduciary, meaning they have the responsibility to handle financial matters for the estate. The bond is required to ensure that the estate is protected financially if the fiduciary were to misuse their authority. The bond required may be as much as double the value of the estate.
On the other hand, a will naming an Executor may have a bond waiver in the section that names the estate’s Executor. Not only does it allow an Executor to not have the headache of obtaining a bond, but it saves the estate the expense.
Estate planning is a process that eases the burden of your passing on your loved ones. Drafting a will with an estate planning attorney ensures that legal documents meet the needs of your family and can save you money in the long run.