The average 75-year-old American has about $462,000 in retirement savings, according to the Federal Reserve, but not everyone has the cache needed to ease through their golden years.
Many people reach their senior years with few to no assets. They don’t have savings, they don’t own homes and they’re largely reliant on the money they get from Social Security to cover their living expenses.
If you’re older with no savings or assets of significant value, then you may wonder if it’s worth writing a will. After all, why spend the time and go through the hassle if there’s nothing to pass down?
You should know, though, that you don’t need a sizable estate for a will to make sense, because it’s not always about the money.
You still want control over your assets
You may sell yourself short, but remember, the things you own may have sentimental value and potentially hidden value. If you want to ensure your belongings go to specific people — whether it’s a grown child, a grandchild or a beloved nephew — then you need a will to spell that out.
Without a will, there’s no telling what might happen to your assets upon your passing. That means the $23 painting your daughter has always loved might not end up with her if you don’t make your wishes clear.
Furthermore, you never know which of your assets might be more valuable than expected. That old piece of jewelry you kept as a gift from a former flame? You might assume it’s worth next to nothing, but an appraisal might reveal that it’s a $1,500 piece. And that $23 dollar painting your daughter loves might be a priceless work of art, like that Dürer drawing bought for $30 at a yard sale.
Even the old clunker in your driveway may be worth something — if not to a new driver, then to a dealer that can sell it for parts. So it’s best to create a will so that there’s no confusion over who gets to inherit your possessions and to also potentially help your loved ones avoid conflict.
An estate-planning step you can handle on your own
Nolo, a California-based publisher of DIY legal books, estimates the lowest cost of a basic will is $300.
Still, it’s more commonplace for a lawyer to charge $1,000. If those two figures aren’t within your range, you can still reach out to local attorneys and see if they are willing to work with someone on a tight budget. If not, you can always look at online will templates and create one yourself.
Now, if you’re handling your will solo, there are points to keep in mind. First, you’ll generally need to sign it in front of two witnesses. You’ll also need to make a list of your assets and designate beneficiaries, as well as an executor. Plus, a will could also be beneficial if you receive a payout from a life insurance or an accident claim.
If your beneficiary predeceases you, the insurance payout will go to your estate. Then the beneficiaries of your will receive the money.
It’s also important to store your will in a safe place and to let your executor and beneficiaries know how to access it. If you have a safe deposit box at your bank, that’s one option. Otherwise, a fireproof safe works.
Don’t forget that if you have pets, you should include instructions for their care if they outlive you, and let your loved ones know your wishes. Very few people want a surprise cat, dog or ball python.
Of course, one drawback to writing a will is that it’ll still be subject to probate upon your passing. That means a court will have to validate your will, which could take months.
Instead of a will, you could consider a small estate affidavit, which may be an option if you have limited assets. A small estate affidavit, like a will, gives you a say as to who inherits your assets. But unlike a will, it isn’t subject to probate. That could spare your loved ones the stress of having to go through that process, and it could make sense if the amount of assets you’re passing down isn’t very substantial.
You may, however, need to consult an attorney to make sure you qualify, as the definition of a small estate can vary depending on where you’re located.
