Why a Will Should be Part of Your Financial Plan

August is National Make-A-Will Month, an annual reminder of the importance of having a legally binding will. The idea of creating a will can feel overwhelming for many, but it’s a crucial element of a robust financial plan.

At Larson, we believe in a holistic approach to financial planning. We consider every aspect of your life, including how your financial assets will be distributed after your death.

The Importance of Having a Will

A will is an essential estate planning document. Without a will, your estate may be subject to intestacy laws, which can result in unintended beneficiaries receiving your assets. This can lead to complications, prolonged probate processes, and potential disputes among family members

Common Mistakes When Creating a Will

Despite the importance of having a will, many people make mistakes during its creation that can undermine their intentions.[i] Some of the most common errors include:

• Improper Execution: Failing to have the will properly witnessed can invalidate the document. Wills must be signed in the presence of two witnesses who meet specific criteria.
• Poor Planning: Not including “Plan B” provisions if beneficiaries predecease the testator, or failing to establish trusts for minor children can create significant issues.
• Overlooking Important Details: This includes not addressing digital assets, such as online accounts and login credentials, or failing to make provisions for pets. Pro-tip: make sure you don’t miss anything by creating your own legacy letter!
• Procrastination: Delaying the creation of a will is a common and significant mistake. Without a will, your estate may be left vulnerable.

But by avoiding these common pitfalls, you can ensure that your will accurately reflects your wishes and minimizes potential conflicts for your beneficiaries.

Why a Will is Part of a Robust Financial Plan

A will is more than just a document for distributing assets; it’s a key component of a comprehensive financial strategy. Here’s how it factors into a holistic financial plan:

• Asset Distribution: A will protects your assets and ensures they are allocated according to your wishes. This is particularly important if you want to avoid intestacy laws which may not align with your intentions.[ii]
• Protection for Loved Ones: Wills allow you to provide for your family and dependents, including designating guardians for minor children. This is critical for ensuring your loved ones are cared for in your absence.
• Legacy Planning: Through a will, you can leave a lasting legacy by supporting causes you care about through charitable giving, aligning with the goal-driven nature of holistic financial planning.[iii]
• Risk Management: Including a will in your financial plan helps mitigate risks associated with estate disputes and potential litigation, providing clear instructions for asset distribution and reducing the likelihood of family conflicts.
• Tax Considerations: A well-crafted will, as part of a comprehensive estate plan, can help minimize estate taxes and other financial burdens on your beneficiaries.
• Integration with Other Financial Tools: In a holistic approach, wills work in conjunction with other financial instruments, such as trusts, life insurance policies, and retirement accounts. This integration ensures a cohesive strategy for managing and transferring wealth.
• Regular Updates: Holistic financial planning emphasizes the importance of regularly reviewing and updating your financial documents, including your will. This ensures your estate plan remains aligned with your current life circumstances and financial goals.

The Peace of Mind a Will Brings

Having a will in place offers peace of mind, knowing your affairs are in order and your wishes will be respected after you’re gone. It’s not just about protecting your assets; it’s about protecting the people you care about most.

As you review your financial plan, consider the role of a will in safeguarding your legacy. National Make-A-Will Month is the perfect time to act. Whether you’re creating a will for the first time or updating an existing one, we’re here to guide you through every step of your financial journey.

At Larson, we want to ensure your plan is as comprehensive and robust as possible. Our advisors work closely with estate planning attorneys across the nation. If you haven’t established a will (or your other estate planning documents), contact your advisor today.

Additionally, if you already have legal documents in place, this is a great opportunity to review your plan with your advisor to make sure it’s still aligned with your financial goals. 

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[i] https://www.humangood.org/resources/senior-living-blog/writing-a-will-common-mistakes

[ii] https://www.kiplinger.com/retirement/holistic-estate-planning-everythings-under-control

[iii] https://smartasset.com/financial-advisor/holistic-financial-planning