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WORLD BUSINESS

Estate planning: Make a will

By Bina Brown
For CNN

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(CNN) -- If you care about who gets what bit of your estate after you die then it makes sense to document it properly.

While most people know what a will is, the majority of people either don't leave one that is valid or die "intestate" -- that is, they don't leave a will at all.

Whether people think it is tempting fate to write a will or just don't want to face the prospect of death is something that is hard to know. But according to the Revenue and Customs service in the United Kingdom, 60 percent of Britons die intestate. In the United States it is 66 percent and in Australia about half of the population dies without a will.

A will is a legal document that clearly sets out your wishes for the distribution of your assets after your death. The recipients of your property become known as the beneficiaries and can be anyone you nominate.

If you die without a will your estate may end up in the hands of the government which generally divides it according to a formula. That formula could have been written decades ago and may not reflect your wishes.

Wills are particularly important if you want to benefit a charity, parents or friends.

As almost every jurisdiction has its own peculiar requirements for what should be in a will, there is no general formula. But there are a few specific items, such as the person making the will must be over a certain age (usually 18).

Since there are many little mistakes that can render a will invalid it is generally recommended that legal help be sought -- particularly where trusts or blended families are involved.

To use legal parlance, the person whose will it is becomes the testator.

Most wills must contain some specifics including:

  • The testator clearly identifying him or herself as the maker of the will, and that a will is being made. This is typically satisfied by the words "last will and testament" on the face of the document.
  • The testator should declare that he/she revokes all previously-made wills and codicils (additions to a will). This makes for a cleaner process and avoids confusion.
  • The testator must sign the will, usually in the presence of at least two disinterested witnesses (persons who are not beneficiaries). It is not a legal requirement to date a will but dating it helps prove it is the latest will.
  • The testator's signature must be placed at the end of the will. If not any text following the signature will be ignored, or the entire will may be invalidated if what comes after the signature is so material that ignoring it would defeat the testator's intentions.
  • Other things that should go in a will to help avoid disputes are the appointment of an executor -- someone to carry out the directions in the will. If the testator doesn't appoint an executor the court will. It is important to dispose of all your assets in the will. Not doing so may mean there is partial intestacy.

    It is also advisable not to try and list all of your worldly possessions but rather use a generic term like "all my assets." This ensures no part of the estate is left out.

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