We are both in our mid-twenties. Currently do not have dependents.
It is never too soon to plan for the future. Wills are not just for the rich. Regardless of how much or how little money you have, a will ensures that whatever personal belongings and assets you do have will go to family or beneficiaries you designate. Without a will, the court makes these decisions. Once you have children a will is a must, to ensure that you get to choose your children's guardian. Few people plan to die in the near future, but if you die suddenly without a will, you'll be subjecting your family and loved ones to confusion and anxiety at what is already a difficult time. This important document is vital to protecting your family and your assets in the event of an untimely death.
We covered this topic in one of our newsletters as our clients ask these types of questions a lot. You can find the article here http://karpcapital.com/newsarchives/KarpCapitalFocus-2013-Q1.html#12.
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Well, everyone techincally has a will, as if you pass away without drafting one yourself, the courts will draft one for you. In this circumstance, depending on your states laws, likley 100% of whatever you have would go to your new spouse. Drafting you won will can put control in your hands rather than the courts. Please note that any asset with a beneficiary designation (i.e. retirement accounts, life insurance) are governed by the beneficiary designation and a will has no bearing on it. Lastly, while a will may or may not be something you need, we do always recommend health care power of attorneys to appoint someone to handle medical decisions for you in case you are unable to do so yourself.
Yes, even though your situation sounds very simple at this point in life, it never hurts to do good planning. A will "package" should also include things like a durable power of attorney, and physician's directive, which are important things to have no matter what age you are.
It's never too early to get a will. I would personally recommend working with a local attorney, but if you must DIY is an option. An attorney will cost a little bit more, but I think you're going to be more comfortable working with someone who does this for a living.
Congrats on getting married as well. Here are a few more tips I like to share with all newlyweds.
Be completely honest and up front. Since you just got married, you must have the "financial" talk, if you haven't already. What do you have saved, what debt do you bring in, what are your goals, etc. This will allow everything to be laid out on the line so that a foundation can be formed.
Begin to formulate a plan and figure out where to start (this is the toughest part for most couples). Whether the couple decides to take on the task themselves or hire a planner, a plan must be formed for what each person is wanting to accomplish. Decision points would include: creating some kind of cash flow plan (budget), saving for retirement, paying off debt, having a rainy day fund, down payment on a house etc. These are typically the priorities that come up first.
From there, IMPLEMENT. This is the most difficult part for couples. Most people have an idea of what they want and may event take the time to create some kind of plan, but the hardest part is actually following through. Obviously I'm a little biased, but having a financial planner to hold the couple accountable is very important (unless they have the discipline to do it themselves...which most people don't).
Track progress. Are you keeping tracking of your cash flow? Is debt being paid off? Is a retirement account being built up? Is a savings account being built up? Are you moving in the right direction? Why and why not? Automation is really the key here or what I like to call pay yourself first. Most people try to sock money away at the end of the month when no money is leftover, where they should really be saving it immediately after the paycheck hits their checking account. Auto-payments should be set up to direct money where it needs to go (all savings should be treated like a fixed expense item on the cash flow plan)
Best of luck on your life together and please feel free to reach out any time.
Both of the previous advisors have given you good advice. The only thing I would add is that if you think you may be inheriting assets that you were intitled to before you were married and you are not sure you would want to leave them to your new spouse or her future spouse if something were to happen to you. Then you may want to consult an attorney about the process of making sure those assets are held somewhere seperately and never comingled with other joint property. I think of course this varies by state and as always if something like this is a concern to you please reach out to the legal community for a more precise answer.
I want to congratulate you on your recent marriage. A will is an important first step. Please find a local lawyer by visiting http://www.lawyers.com/, and also have a Financial Professional review your Life Insurance since you have a wife who may come to rely on your income and vice versa.
You've read some terrific answers by these contributing advisors. Now that you're married, as you update your wills, you may also want to update beneficiaries on your retirement accounts and insurance policies. Congratulations and good luck.
Of course you should have wills, and update them whenever your family or financial situation changes. But keep in mind that the way your assets are titled - and beneficiary designation in retirement plans - is even more important than a will. Newly married people sometimes keep accounts at the bank or investment accounts in individual names. This can lead to serious problems if one of you has a serious accident that leaves them incapacitated.
Congrats on your recent nuptials. Wills are important and I suggest finding a lawyer in your area that can help you with this. It is much easier and cheaper to do a will online , but you leave yourself open to someone contesting the will. A contested will is when someone who would have inherited assets does not feel like they are getting their fair shake so they object to the will for numerous reasons to long to list on this forum. If the will is written in front of attorneys you greatly reduce the potential for a contested will. Wills also tend to be finished and forgotten for many years so you want to make sure you cross all your T's and dot your I's, in case you forget about the will for 20 years. Also, remember your life insurance, bank accounts, IRA's and any other account you may have that has a beneficiary to change the beneficiary to your current spouse.
Have a great day and great job thinking about a will so early in life,