The following is general legal information, provided as a public service by Oregon’s lawyers. The information is not intended to be legal advice regarding your particular problem. Note that changes may occur in this area of the law.
What is a will?
A will is a set of instructions that explains how you want your property distributed
after your death. In Oregon, you must be at least 18 years old and of sound
mind to make a will. If you are married, you can make a will before you turn
18. Your will must be in writing and must be signed by you and two witnesses.
The witnesses must also have seen each other witness your will. Some people
cannot serve as witnesses to your will. It is important to make sure that all
of Oregon’s legal formalities are carefully observed.
What are the benefits of a will?
A will allows you to decide who will manage your money and other property
after you die, and how it will be distributed. It lets your wishes
be heard regarding the care of minor and disabled children. It often
prevents disputes among your relatives. In a large estate, a will
can also reduce the amount of taxes that may be due at your death.
Who should draft a will?
A will is an important legal document that can have a significant impact
on your family. A lawyer can give you good advice on how the will
should be prepared and executed. Having a lawyer draft your will
gives you the assurance that your voice will be heard regarding how
you want your children to be cared for and how you want your property
to be distributed.
Does a will avoid probate?
No, but a having a will can reduce the cost of probate and the burden
to your friends and family. Whether your property needs to go through
probate is determined by how that property is titled, not whether
you have a will.
Can joint accounts substitute for a will?
Joint accounts, life insurance and retirement accounts usually do not
have to go through the probate process, but they do not act as a
complete will substitute. Many spouses own real estate, bank accounts,
stocks and bonds, and other types of property as husband and wife
with the right of survivorship. This means that if you die, your
jointly owned property passes automatically to your surviving spouse,
regardless of what your will says. Life insurance and retirement
accounts are contractual documents. You should fill out the beneficiary
designation form for each company you contract with to tell that
company who is to receive your death benefit. Your beneficiary designation
will determine who gets the benefit regardless of what your will
says. Beneficiary designations and jointly owned accounts can be
good probate avoidance techniques but should only be considered as
part of a complete plan that includes a will.
What happens if I do not have a will
If you do not have a will, and if you have probate property, your property
will be distributed according to instructions made by the Oregon
legislature. For example, if you are married and don’t have
children, all property that is in your name alone will go to your
spouse. This is also true if you are married and have children that
are born of your current marriage. If you are married and have children
from a prior marriage, half of your property will go to your spouse
and the other half will go to all of your children. If you have a
child under the age of 18, the court may choose someone to take care
of the property for that child. If you do not have a will or any
family that would be entitled to your property, your property (that
is in your name only) may go to the state of Oregon. Your family
(heirs) includes a large category of relatives: spouse, children,
grandchildren, parents, siblings, grandparents, nieces, nephews and
cousins.
Whom may I choose to inherit my property if I write
a will?
The only rule is that if you are married, your spouse has a right to
claim 25 percent of your estate. Generally, unless you entered a pre-marital
agreement in which you validly waived your right to claim 25 percent
of your spouse’s estate, spouses cannot disinherit each other.
You are not required, however, to leave anything to your children or
other family members.
You may instead choose a friend or charity to inherit your property.
If you plan to disinherit a family member it is very important that
you consult with an attorney experienced in estate planning to make
sure that your plan will be followed.
What is a personal representative?
If your estate needs management, a personal representative (executor)
will be appointed by the court. Having a will lets you decide who
that person will be. You may choose someone familiar with your property
and affairs or a professional who can serve as a personal representative.
If you think there may be hard feelings in your family or your estate
has complications such as children from a previous marriage, you
may want to name a professional. Many banks and trust companies have
experienced people to handle the difficult task of being a personal
representative and — since the fee paid to a personal representative
is determined by the size of the estate, not by who serves as personal
representative — banks and trust companies are generally paid
the same fee to serve as personal representative as an individual
is paid.
What is a trust?
A trust is another tool used in estate planning that can be created
as part of a will or as a separate document. A trust is a legal document
that appoints someone (a "trustee") to manage your property
and gives detailed instructions on how the property will be managed
and distributed. A trust is one way to take care of a minor child,
an elderly person or someone who needs help handling money. A trust
may be established during your lifetime, and you may act as your
own trustee, or it may be established by your will after your death.
Trusts are generally more complicated to create than a will, and
you may want to consider having an estate planning lawyer assist
you.
Can a revocable living trust substitute for a will?
A properly drafted revocable living trust can work well as a substitute
for a will and sometimes may reduce the costs of handling your estate.
However, even if you have a trust, most advisors would recommend
you also have a will to cover the possibility that some of your assets
may not be covered by the trust at the time of your death. Whether
a trust is proper for your estate is a decision to be made after
receiving competent legal advice.
Is a will expensive?
No, a simple will is not expensive. However, the cost of any will depends
on how much work your lawyer does for you. As a will becomes more
complicated, the cost rises. Ask your lawyer for an estimate of the
cost. In general, the trouble and expense of not having a will far
outweigh the cost of the will.
Do I need a will if I don’t have much money?
The amount of property you own does not determine whether you need
a will. Your personal and financial circumstances determine when
and how a will should be drafted. For example, it is important for
new parents to have a will to provide for their children even if
they own little personal or real property.
What are estate and inheritance taxes?
Estate taxes are the taxes that need to be paid out of your estate
after you die. For the year 2008, estates worth over $1,000,000 are
taxable by the state of Oregon, and estates worth over $2,000,000
are also taxable by the federal government. These amounts are scheduled
to change in 2009. Please see your advisor before making any changes
based on them. An estate planning lawyer may be able to draft a will,
trust or other document, as well as give you advice, to help reduce
the amount of taxes your estate may owe upon your death.
Is a will from another state valid?
Yes. Generally, if you made a will in another state according to the
laws of that state, it is valid in Oregon also. This is also true
if you created a trust in another state.
Can a will be changed?
You can change your will at any time as long as you are of sound mind.
Major life events such as marriage, divorce, death of a family member,
or a new baby are good reasons to consider changing your will. In
fact, in Oregon, marriage generally revokes any will you made before
your marriage. You may revoke your old will by destroying it or by
writing a new will. If you only want to make minor changes, you may
create a "codicil," a document that is attached to your
will. The same legal formalities are required for creating a codicil
as a will, and therefore it is wise to consult an attorney about
the changes you would like to make. In the meanwhile, do not write
on your old will, because you may end up invalidating the entire
document.
Should I consider having a medical advance
directive and a financial power of attorney?
Yes. A will only takes effect after you die. An advance directive and
power of attorney are documents that may be used to manage your health
care and finances while you are still living. A power of attorney may
be created for any purpose, but most commonly an elderly person will
nominate a close friend or family member to be their "agent" to
help manage their money. Because this power can be abused, it is wise
to seek the advice of a lawyer before signing a power of attorney.
An advance directive is a document in which a person appoints a "health
care representative" to make medical decisions such as living
arrangements and treatment options when they become incapacitated and
unable to make their own decisions. An advance directive can be used
to indicate whether you wish to have life support, tube feeding or
other heroic measures when you are close to death. A power of attorney
and advance directive can be excellent end-of-life planning tools.
Both documents expire at death, or can be revoked at any time.
Legal Editor: Jessica Cousineau, April 2008