What is a Will?
February 3, 2021
Understanding A Will
So welcome back everyone to our series on trust. Today we’re going to be talking about what a will is and I know this sounds counterintuitive but sometimes the best way to understand what a trust is to understand what a will is and how it works.
So first of all a will is everything that you’ve seen in tv or the movies, it’s just a statement of who gets what after you pass away and then, secondly who handles your affairs for you after you’re gone. So, the stuff that you have in your name or your assets, we call your estate or your estate assets. So, who inherits your estate is the people that you name in your will, they benefit from your will so they’ll call the beneficiaries of your will, and the person that you name to handle your affairs is called your executor. So, executors are for wills and trustees are for trust.
So right now, we’re just talking about wills. So what does an executor do?
Executor’s Role in probate
Well in California if you have a real property of any significant size or if you more than a $166,250 in assets in your estate, then we’re going to supervise or our government is going to supervise the administration of your will and the job that your executor does for you and that process of supervision is done with through the court system and it’s called probate, because you can think of it like their proving or probing to make sure that the executor follows the terms of their will, that everybody is treated fairly, that everybody gets notice of all these things. And so that’s what probate is.
In probate, what does the executor do? He has three jobs, he collects the estate assets, and then he pays off bills, pays off creditors, notifies them and pays off bills and then whatever’s leftover he would distribute out to the beneficiaries that are named in the will. And that process is called probate. The executor is functioning under the supervision of probate court judge. That means that there’s a court case, but it’s not like a P vs D, it’s an administrative case until somebody complains about something.
Process of a will
So, this is the process of a will. A will transfers things that are in my name, to people that I name as my beneficiaries and the person that handles it for me is called my executor and they do those three jobs: Collect Assets, Pay off Bills, Transfer the Balance to the Beneficiaries. Again, this is all done under the supervision of our court system. If you have a real property of any significant size or $166,250 in other assets.
So, this is important to understand because trust is similar things, but they do a little bit differently and so understanding that this Will functionality is to transfer stuff in your name. A Trust functions a little bit differently.
So stay tuned we’ll have more videos in this series on a what a Trust does and how it works.