As an estate-planning law firm, we are asked by clients, how much money do I need to create a will? In simple terms, there is no minimum net worth requirement for creating a will. Frankly, net worth is far down on the list when it comes to reasons for drafting a will. I know this is the attorney’s perspective, but everyone, regardless of their financial situation, is encouraged to have a will. Let me explain why.
One very important reason for a will having nothing to do with money is guardianship for minor children. As a parent, you want to do what is right for your children. Making sure they will be taken care of if you can’t do it yourself is one of those steps. If you have minor children, a will enables you to designate a guardian for them if you pass away. If both parents die and neither have named guardianship for the children, the guardianship is left up to family members to volunteer and the county court to decide.
The second reason to execute a will having nothing to do with your net worth is to name an executor for your estate. A will allows you to name a person who will be responsible for managing your “estate,” including distribution personal property like vehicles, jewelry, furnishings, tools, collections, etc. and ensuring that your final wishes are honored. If an executor is not named, a probate court will have to name one based on the state’s probate laws.
Now let’s talk about larger assets. If you have assets, personal belongings, or specific wishes for the distribution of those things, a will is the place to do it. A will allows you to specify how you want your belongings to be distributed among your heirs and beneficiaries. You may list out specific percentages or amounts to individuals as well as charities or non-for-profits that you would like to benefit. Additionally, you may designate special directions for pets including who shall take care of them and setting aside money to pay for that care. Without a will, Illinois will distribute everything you own at your death according to intestacy laws. I often find clients’ wishes do not align with the direction provided in the Illinois intestacy law. This makes having a will imperative to achieve any estate planning goals.
Regardless of your net worth, creating a will is an important decision that is about more than just how much money you have when you die. A will gives you and your family peace of mind and shows your family and loved ones what was important to you while you were living. Remember, as your financial picture evolves, it’s important to review and update your will. Your will can be changed at any time. I personally review mine annually, or after any major life-changing event. It’s best to do a regular review to make sure your will always align with your values.