When people think about their estate planning needs they often first think of wills, and wills are appropriate for most people. However, it’s possible to have a well drafted will and still not understand what it does and does not do and what you are trying to accomplish with it. That is why it is important to understand the context and purpose of wills.
Wills simply pass property which doesn’t already have a proper beneficiary designation as to whom it should pass upon death. For example, life insurance policies typically have designated beneficiaries and, upon the death of the insured, the death benefits pass to the named beneficiaries. That occurs outside of and independent of the person’s will. Likewise, if two people are on title to property as “joint tenants,” when one of them dies their interest in the property passes to the other by means of the title, regardless of anything the person’s will may provide. If you are able to properly designate beneficiaries of all of your property, it is possible, and often desirable, that none of your property will pass to your beneficiaries through your will.
Why might this be desirable? Because, if you are able to pass all, or most all, of your significant property through beneficiary designations, titles, trusts, and other such means (and frequently you are able to do so), you may be able to avoid “probate” proceedings. Probate is a court administered proceeding to pass property pursuant to the terms of a will. If you have no significant property that needs to be passed through your will, you may not need probate.
The law on beneficiary designations has expanded significantly in Colorado in the past decade, and many people are able to arrange their estates so that all of their property passes to beneficiaries outside of their wills, thereby eliminating the need for probate. Typically these people still have wills as basic estate tools and as a “catch-all” for any property that may not have a proper and effective beneficiary designation. There are also other reasons that wills are valuable, particularly when you have minor children to be provided and cared for.
If you would like to discuss your estate situation with one of our experienced attorneys, please feel free to call and schedule an appointment.
Disclaimer – The foregoing are observations and opinions of the author. It is not legal advice and should not be relied upon as such. The law is complicated and there are exceptions. You should always discuss your particular facts and circumstances with a qualified attorney.