Why most Americans still don't have a will and the 3 documents every adult needs
August is National Make-a-Will Month, but most Americans still do not have one. Only about 24% of adults report having a will, according to a survey by Caring.com.
Certified financial planner Regina McCann Hess says one of the biggest misconceptions is that estate planning is only for wealthy families.
"It goes down to who do you want your beneficiaries to be, and how do you want that money distributed?" she said in a recent appearance on the In Your Corner podcast.
The cost of doing nothing
Many people avoid estate planning because they do not want to think about death. But McCann Hess says failing to put a plan in place can create major problems for loved ones.
When someone dies without a will, family members may have to go through the court system to determine who will administer the estate and how assets will be distributed. That process can lead to delays, legal expenses and family disputes.
"It's more expensive to not have a will than to have a will," McCann Hess said.
The 3 documents every adult should have
McCann Hess says a comprehensive estate plan includes more than just a will.
Key documents include:
- A will
- A healthcare power of attorney
- A durable financial power of attorney
A healthcare power of attorney designates someone to make medical decisions if you become incapacitated. A financial power of attorney allows someone to manage finances, pay bills and handle financial matters on your behalf if you are unable to do so.
McCann Hess noted that many people are more likely to need a power of attorney than a will because incapacity can happen at any stage of life.
Why beneficiary designations matter
One of the biggest estate planning mistakes involves outdated beneficiary forms on retirement accounts, insurance policies and other financial assets.
McCann Hess explained that beneficiary designations can supersede instructions contained in a will.
That makes it especially important to review documents after major life events such as marriage, divorce, the birth of a child or the death of a spouse.
Reviewing your plan
For people who already have estate planning documents in place, McCann Hess recommends revisiting them periodically and after significant life changes. A review every five years is a reasonable guideline if no major changes have occurred.
Her advice is to focus less on death and more on protecting loved ones.
"Take care of yourself and your family by thinking about what their future is going to be when you're gone," she said.
How to get started
McCann Hess recommends scheduling a consultation with a local estate planning attorney. These are the experts, and they can tell you whether your situation is simple enough for an online service.
You can search professional directories like the American College of Trust and Estate Counsel.
FreeWill is an online estate planning platform that lets users create legally binding wills, living wills, and power of attorney documents at no cost. AARP has free resources to help you get started with estate planning.
Community Legal Services of Philadelphia also offers assistance with wills and estate planning.
Watch or listen
To hear the full conversation with Regina McCann Hess, including common estate planning mistakes and practical steps to get started, you can find the latest episode of the In Your Corner podcast on the CBS Philadelphia YouTube channel.
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