Chadwick Boseman attends the 91st Annual Academy Awards on Feb. 24, 2019.
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When “Black Panther” star Chad Boseman died almost two months ago after a four-year battle with colon cancer, he didn’t have a will.
Now, the fate of at least part of the 43-year-old actor’s estate is left up to the courts. His wife, Simone Ledward, has asked to be named administrator with limited authority over the estate, which has an estimated value of nearly $939,000, according to court documents.
That isn’t necessarily the entirety of his estate and, because there was no will, those assets are subject to probate and court intervention. Some accounts, such as life insurance and qualified retirement accounts like 401(k) plans and individual retirement accounts, may be passed down to a beneficiary without having to go through the courts. Up to $11.58 million per person can be passed on tax-free to heirs.
The actor isn’t the only celebrity to die without making plans for his or her estate. Musician Prince also left behind no legal instructions for his $300 million estate when he died in 2016 at age 57.
Yet wills and estates planning aren’t only for the wealthy.
Still, many people procrastinate. They may mistakenly think they don’t have a lot of assets or what they do have will automatically go to next-of-kin.
“It doesn’t matter how many assets you have, an estate plan will ensure that your medical and financial decisions can be made by someone that you trust,” said Texas-based estate-planning attorney Shann Chaudhry.
“A plan can help you address potential tax liabilities, find benefit programs you may be eligible for, and protect your family from costly guardianship or conservatorship court.”
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While the coronavirus pandemic has prompted more people to create wills, 62% of Americans still don’t have one, according to a LegalZoom survey conducted by YouGov. Of those who do have a will, 26% got one because they were afraid of serious illness or death related to Covid-19, the survey found. Thirty-two percent of those ages 18 to 24 created a will due to Covid-19.
“No one wants to admit their own mortality,” said Steve Parrish, co-director of the Center for Retirement Income at The American College of Financial Services.
“Most people avoid thinking about it.”
Here is what you need to know.
Table of Contents
Online wills vs using an attorney
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A last will and testament spells out whom you want to give your assets to after you die. If you have minor children, it also allows you to name a guardian to care for them.
In your will, you also name an executor, who is tasked with making sure your wishes are followed.
Things like your house, if set up correctly, will go directly to your spouse without a will, Parrish pointed out. Life insurance and financial accounts also have beneficiary designations and can be passed down without a will.
“If I was on the Titanic, and needed a lifeboat for myself or my family, and my options were buying a professionally assembled lifeboat or making my own from a kit, I would purchase the professionally assembled boat — even if it were substantially more expensive,” Chaudhry said.
If you opt for an online will because you need an immediate option and have a very basic situation, make sure that it is a state-specific one, said Parrish. Sometimes they are provided by the local bar association or university, he said.
If you don’t have a will, the court will end up deciding the fate of your estate.
“A lot of folks say, ‘I don’t have an estate plan’ but you do — the state has one for you,” said Michael Roberts, president of Arden Trust Company, which has more than $7 billion in assets under management.
“If you have not planned and you don’t have a will, there is a statutory provision for whatever state you live in — this is how your property gets distributed.”
A durable power of attorney
If you are sick and unable to do things like pay your mortgage, rent and other bills, a durable power of attorney enables you to assign someone to make financial decisions for you.
This can be a spouse or another family member or a friend. You can also name a backup in case your first choice is unable or unavailable to fill the role.
This designates someone to handle your medical decisions if you become sick and can’t make them for yourself — from the emergency room to ongoing hospital care, rehabilitation and outpatient visits. It is also called a health-care proxy.
Because medical information is private, due to the Health Insurance Portability and Accountability Act, also include a HIPAA authorization so that doctors can share that information with those making medical decisions, Parrish advises.
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This is not to be confused with a last will and testament.
A living will, called an “advanced directive” for medical decisions in some states, is a written document that lets you express your wishes for medical treatments you would or would not want to be used to keep you alive, including resuscitation and intubation. Your health-care proxy must abide by what you have spelled out in your living will.
“Having those documents in place ensures that you will have an advocate and your wishes will be followed,” said Arden Trust’s Roberts, who is based in Atlanta.
Finding an attorney
The best way to find an attorney is to ask family, friends, colleagues or your financial advisor. You can also go to the American College of Trust and Estate Counselor the National Association of Estate Planners to find an attorney in your area.
Then interview a few to get quotes on their fees so you know what you’re paying up front. Many attorneys also will give you an initial consultation for free to gauge the extent and complexity of your needs.
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Costs can range widely. A basic plan may be a couple hundred dollars.
“I realize that is a lot for this economy, but if I had the ability to spread out payments over time, I would,” Chaudhry said. “There are a great number of attorneys with payment plan options.”
Complicated plans with trusts and tax considerations could run $7,000 to $10,000, Roberts added.
Online wills generally are less expensive. For instance, a basic last will is $89 on LegalZoom, a comprehensive one is $99 and an estate plan bundle costs $179.
While a will is necessary to let everyone know your final wishes, it’s also important to make sure your family members know where to find your important financial information.
Make a list of what they need to know, including where to find your will, bank account information and passwords to your accounts.