Do You Have a Will?
If you have a family or want a say in how your assets are disbursed, read on.

lthough many of us have good intentions when it comes to putting our financial affairs in order, we may put off writing our will for all sorts of reasons: We're not sure where all our inportant papers are, we dislike thinking about death or we believe we can get along without one.

Who needs a will?
No matter how old or young you are, you need a will if:

• You want a say in how your assets are to be distributed. If you're married, all your assets go to your spouse upon your death, which is fine-if that's what you want. But what would happen if the two of you were to die simultaneously? Your estate would go to your children (if you have any), and a state-appointed trustee would manage your children's financial affairs until they reach maturity.
  
  If you're single and die intestate (without a will), state law dictates how your possessions are to be divided. The state will divide your assets among your parents and your siblings but will ignore your friends and your favorite charity.
  
  
• You have minor children. A will is the only document that allows you to choose a guardian for your children. You may want your sister as the guardian, but if you die without a will, a judge who doesn't know your family will decide who is to care for your children. No one wants that. Worse still, two or more of your relatives may wage a custody battle if your intentions aren't clearly spelled out.
  
  
• You have a significant other to whom you are not married. Unless you have a will, your partner will get nothing. That's because states ignore this bond unless there is a valid will specifying otherwise.
  
  
• You have children from a previous marriage and want to leave something to them. If you don't put your request in writing, all of your money will go to your current spouse. One way to provide for a minor child is to set up a trust. Contrary to what many people think, trusts are not just for the wealthy.

Understand the process
If you're dreading doing a complete inventory of all your assets before writing your will, relax. You don't have to. There's no need to wait until that miraculous day when you're “completely organized.” But it is a good idea to make a list of your savings and investment accounts and your insurance policies. The only things you must itemize are specific bequests you wish to make to family, friends and charity.

The good news: Writing a will does not need to be a difficult or agonizing ordeal. Nor does it have to be an expensive endeavor-especially if you're just starting out. If you have very few assets, you can use a will-preparation software package (you can buy one online for about $40), or find a do-it-yourself will kit at a local stationery store. Either can be fine for extremely simple wills.
However, if you possess a few valuable assets-say your car and your savings account-consider hiring a lawyer to draft your will. You can expect to pay a couple of hundred dollars for this service.

How do you find an experienced estate attorney? Ask friends or family members who have similar financial circumstances, your accountant or another financial professional for recommendations.
As your financial life gets more complicated (marriage, children, a house, imvestments), be prepared to pay closer to $1,000 or more for an attorney to write wills for you and your spouse.

Attorneys also add value by asking the right questions. They will help you express your desires clearly to avoid problems after your death. If you suspect that your will might be contested for any reason, get a lawyer.
In addition to a will, consider a few other estate-planning tools like a durable power of attorney, which designates someone to handle your financial affairs in case you're incapacitated.

Understanding the process also requires that you review some changes to estate tax laws. For an estate settled this year, for instance, heirs must pay federal taxes on an estate valued at more than $675,000. The estate-tax-free value increases to $1 million in 2002 and keeps rising through 2010.

If there's a possibility that you'll be over the limit at the time of your death-a house, an insurance policy or sizeable retirement savings could easily put you over-look into restructuring your estate to reduce or eliminate your estate-tax liability.

Choosing an executor
You must appoint an executor to handle the administrative aspects of your estate, which can be time-consuming. The executor pays your debts, files your taxes, makes sure your property is appraised and sold, files life insurance claims and disburses assets to your heirs. Therefore, you should select someone who is willing, organized and living nearby, since they may need to work closely with your family members to settle your affairs.

Some states have laws outlining how much you must pay an executor. Even if your state doesn't, it's good form to pay something to the person who may take months to settle your affairs. The going rate is about 1.5% to 3% of the estate, depending on the level of expertise of the candidate and the complexity of the estate. (A lawyer or financial adviser will get the higher end of the range.) And don't forget to include the terms of payment in the will and the provisions to pay for necessary financial or legal services.

Choosing a guardian
Many parents put off writing a will because they can't decide on the choice of a guardian. Here's what you should consider when identifying candidates:

• Age and health-Your parents may seem a logical choice, but are they healthy and energetic enough to take on this rigorous responsibility?
• Time-Does your best friend or sibling have time to raise your kids?
• Education and religion-Do your candidates share your views?
• Geography-Does your potential guardian live nearby? If you have a choice, it's probably best not to move your kids away from other family members and all that is familiar to them right after they've lost their parents.
• Money-Can your candidates afford to take on additional dependents? If you haven't left much money to raise your children, you must be sure that you're not placing an impossible burden on a guardian.

Last words of advice
Once you finish your will, review it carefully and then sign it. The courts do not recognize unsigned wills. Also, keep the official copy of your legally valid will in your attorney's office, not in your safe deposit box. And then give a family member or close friend the name and contact information for your attorney in writing.