When you wrote your will, you carefully allocated your major assets to certain beneficiaries – including real estate, investments and more. You may have also made some very deliberate and thoughtful gifts to your loved ones, including items of significant emotional value.
So, who gets everything that’s left? No matter how carefully you try to make your estate plan, it can be very difficult (if not downright impossible) to account for everything you own and include it in your will.
There’s also a very good chance that somewhere between the time you write your will and the time it is needed you’ll acquire new things – whether that’s property, investments, business interests or personal items.
Anything not expressly mentioned in your will is called your residuary estate – and all of that could end up subject to intestacy proceedings.
What does that mean?
When someone dies without leaving behind clear directions for how their assets should be allocated to their chosen beneficiaries, that’s called dying “intestate.” Even if you have a will, if you forget to designate a residuary beneficiary for anything not specifically mentioned in your documents, you can be in partial intestacy.
If that happens, the state will use its own rules of succession, which means that the government – not you or your family – will decide how those assets are divided. In addition, that will force your loved ones to endure a much more complicated, longer and costlier probate process.
You can avoid this problem very easily, however, simply by including a residuary clause in your will. This is a simple statement that says, in essence, “Everything else not mentioned in this document goes to a specific person,” whether that’s your spouse, an adult child, a charity or a friend.
It’s very easy to make a mistake in your estate plan without the proper assistance. Learning more about your options can make it easier to take care of your loved ones even after you are gone.