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TEXT OF INTERVIEW
Tess Vigeland: Back to our conversation about estate planning. Earlier we explored why just about everybody needs at the very least a will. So how do you get started?
John Ventura is the author of “Kiplinger’s Estate Planning.”
Welcome back, John.
John Ventura: Thanks Tess.
Vigeland: Let’s start with the difference between a will and a living trust. What are those two?
Ventura: A will is a document that actually is a set of instructions about what you want to happen to your assets: Who’s going to get what and how they’re going to get it. Your wishes in that will are given force through a probate system and it all happens after you’re dead. Now, a living trust is a document — it’s actually a legal entity — where you transfer assets into a trust that has an executor and a beneficiary, but you do this while you’re alive. It could be that you would set up inside that trust the ability to take care of someone and the difference is that if you die and you have a living trust, that living trust and whoever the executor is would continue to take care of your wishes without having to go through the probate system and the difference is that in the probate system the distribution of your assets may take a long time.
Vigeland: Let’s go to the specifics of putting together a will for yourself. What are the very basic points that you want to make sure to hit? Is it all about money?
Ventura: No, it’s not all about money. The first thing, I think, you need to look at is do you have any minor children or do you anticipate having minor children and specifically designate a guardian for the child or the anticipated child and a guardian for the property that that child is going to get and it may not be the same person. Then you have to think about all your assets. One of the issues is where are your assets? So you want to put in the will enough information for an executor to know where all your assets are. For instance, there was a case where a woman had a lot of jewelry, everybody knew that she had a lot of jewelry and it was very expensive. She gave no indication in her will where that jewelry was and no one could find it and only by accident it was discovered that she kept the jewelry wrapped up in tissue and placed inside the spindle of toilet paper. It was only after one of her daughters went to use the restroom that they found the jewelry. So you have to pay attention about giving the information that you need to find all your assets. And then you need to be very specific about how you want those assets dispersed. Picking the executor of your will is very, very important.
Vigeland: So how do you do that? How do you come up with the person that you want to entrust that responsibility to?
Ventura: You know, that’s very hard. A lot of people go to the person in their family that they think has the maturity and the authority enough to deal with all the other relatives. Like for instance, Elvis Presley picked his dad, but he did an unusual thing: he had co-executors. he had a bank trust department once his father reached the age where he couldn’t be the executor and make the decisions and do all the work that was necessary, he had a bank that was backing him up. Some people pick people that they’ve had business dealings with like a business partner. You know, the person that has to do that is the person that’s going to have to gather all the information about your estate. They’re going to have to make sure debts are paid. They’re going to have to make sure everything is transferred properly to the people that are supposed to get the assets and it can be a lot of work, so you’ve got to get somebody that’s going to be willing to put in all that effort and is going to do it the way you want to.
Vigeland: Let’s talk about the format of a will. Can it be handwritten? Videotaped?
Ventura: It can be handwritten. Videotape is not approved right now.
Vigeland: But for the most part, do you want to type it out and get a notary public and a couple of signatures?
Ventura: Yeah, you want to have witnesses, you want to have the basic things like you’re an adult over 18, that you’re of sound mind, you want to have those kind of languages and you want to be specific. Quite frankly, I’ll tell you a thing that’s happened in the estate planning area. There has been a tendency for people to try to do these things on their own and there has been a lot of software created to help people do their own wills. You can go on the Internet and have that done as well. One of the consequences of that is a lot estate planning attorneys have reduced what they would charge to do a simple will. It doesn’t make sense to do it yourself when you can have someone do it for you inexpensively and can ask you all the questions that you need to consider when you’re doing your will and you may not think about if you do it yourself.
Vigeland: Is the will the place where you also want to put your final arrangements?
Ventura: No, you don’t want that. There may be some delay and once you die, things happen very, very quickly. There’s going to be decisions about the funeral home and whether or not you want to be buried or not. That needs to be a separate document and that needs to be available to the person that’s going to take care of your affairs immediately. It may be a spouse, but it should be somebody in addition to a spouse as well that can jump in and do the things that are immediately necessary. There’s a lot of things that happen when a person dies. You have to get copies of death certificates. You need to deal with the funeral home and getting those death certificates and you need at least 20 of them to be able to send to creditors. Besides doing all those things, you want people to know what the instructions for you are when you’re being buried and you want that information given to them as quickly as possible.
Vigeland: John Ventura is the author of “Kiplinger’s Estate Planning” and he’s with us for a few weeks now to talk about how you can figure out how to plan your estate. John, we’ll look forward to talking to you again next week.
Ventura: Thanks Tess for having me on your show and I look forward to it to.