Dying without a will: What happens next?

(InvestigateTV) — Only 24% of Americans have an estate plan, according to a recent survey from Caring.com, meaning most are leaving the fate of their assets to chance if they become disabled or die.

The American Bar Association (ABA) said in most cases, state law will dictate how assets and property are distributed in the absence of a will.

Gloria Garcia Cisneros, a wealth manager with LourdMurray, explained that a will helps detail how assets will be distributed. She said having an estate plan sounds complex, but it’s really just about protecting legacy.

“It’s important to just have a plan really, to see what happens to everything you own,” Cisneros said. “And it allows your next gen to receive assets in a more organized way and make sure that your wishes are fulfilled, protect them, and then even minimize possible tax issues or legal issues down the road.”

Cisneros said having a trust is not necessary for everyone, but it does make sense if there’s a chance of court battles. She said people should also create a power of attorney document.

“This is great to designate someone to be able to make financial decisions on your behalf if you’re ever unable to do so,” she added. “So, it’s always just planning for what could go wrong, and making sure that everything’s taken care of.”

She added people should also consider having a health care directive—this specifies personal medical wishes in case they can’t communicate them.

According to the ABA, a principal difference between a will and a trust is that a will only takes effect after someone passes away. It also must be validated by a court through a process known as probate.

A trust, on the other hand, can be used while living and it doesn’t go through the courts. It goes directly to whoever or whatever is designated as a beneficiary.

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