12 Things To Include in Your Will (Some Practical, Some Sentimental)

One of the surprising financial mistakes many people make is putting off creating an estate plan.

If you've done the work to create a good life and want to share it with loved ones, you need to decide what will happen to assets after you are gone.

Are you ready to get down to business and create an estate plan? If so, here is a list of the best things you can will to your children.

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1. Cash

Cash is king in most situations, and inheritance is no different. Cash comes with a value that is easily determined.

It is also easily divided, making it an easy asset to give to your children equally. Cash will benefit your heirs immediately, especially in comparison to other physical assets that may take time to sell.

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2. Roth IRA

A Roth IRA is a type of investment account that is funded with post-tax dollars. That means when you give a Roth to your kids, they will receive the funds tax-free.

Your kids can let the money continue to grow tax-free for up to 10 years. At that point, all the money must be distributed from the Roth IRA.

3. Real estate

While real estate is a difficult asset to split among your kids, it can be a great investment to pass on, especially if your children can earn rental income from it.

Rental real estate can offer a steady stream of passive income to your children. Real estate is considered a good long term investment that can benefit heirs for years after you are gone.

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4. Annuities

Annuities typically provide guaranteed retirement income for the length of your life. Not all annuities provide a death benefit, but those that do can be passed down to heirs.

If the annuity is structured in the right way, you can assign your children to receive a monetary sum when you die. Annuities can also offer tax benefits, saving your heirs money in the long run.

5. Brokerage accounts

Stocks, bonds, and mutual funds in a brokerage account are attractive items to include in your children’s inheritance.

The investments in brokerage accounts can be easily transferred and split among children. The monetary value is already determined based on the current market value. Your heirs can continue to let the investments grow or cash them out.

6. Sentimental items

Not all inheritance has monetary value. Sentimental items such as pictures, letters, and scrapbooks are irreplaceable to family members.

Of course, photos and paper age and show wear after several years. Try digitizing these sentimental items so you can share the memories with multiple children and preserve them for future generations.

7. Art and antiques

Collectibles such as art and antiques can be a good long-term investment because they hold their value well over time. These markets don’t tend to fluctuate as much as the stock market.

Don’t forget to protect these items. Have them professionally appraised and properly insured.

8. Tools

Tools are a practical item to leave to children. It’s likely that as they grow up, your kids will have homes of their own they need to fix and maintain. High-quality tools can last decades and prove useful during a home renovation project.

While your kids may not need a basic hammer or screwdriver, something large like a table saw is definitely worth adding to your will.

9. Recipes

Family recipes are meant to be preserved for decades to come. Food is often the center of family gatherings and traditions, so it only makes sense to include recipes in your will.

Recipes are not only sentimental, but a practical way to keep your memory alive once you are gone.

10. Furniture

Depending on your kids’ age and living situation, they may be interested in inheriting your furniture. Couches or accent furniture can enhance almost any home.

Some furniture items may be desired for sentimental value, like Grandpa’s rocking chair or a handmade cradle that you can use for future babies.

11. Businesses

Families often pass down businesses due to retirement rather than death. But it is also possible that someone will work right up to the day they die. In such instances, your children might want to inherit the company.

A profitable, well-run business is a valuable inheritance, not only because of its monetary value, but also because it produces a steady income stream for your kids. This can benefit your family for generations to come.

12. Life Insurance

Parents looking to load up their kids with cash should consider purchasing life insurance. Life insurance paid out upon death is not considered taxable income and can help set your kids up for a financially sound future.

If your children are named as beneficiaries on your policy, their payout will also skip probate and go directly to them, helping them build wealth quickly.

Bottom line

A well-crafted estate plan can eliminate some money stress for both you and your heirs. While planning ahead for the end of your life may seem grim, doing so can give you the confidence of knowing your loved ones will be well cared for after your death.

Share the will and estate plan with your children while you are still around so you can prevent any confusion or arguments over your decisions.

Money tips that can work for everyone

No matter what your bank account balance is, there's always an opportunity to optimize and improve your finances. Here's a quick checklist of things you can look at today.

Focus on paying off your debt. Debt can hold you back from making progress with your overall financial well-being. Aside from cutting expenses, there are tools that can help you pay off debt faster like balance transfer credit cards and debt counseling.

Earning extra income can give you breathing room. If finances are tight, earning some extra money to supplement your income can make a huge difference. A new job is one option to consider, but if you're not ready to make a big change or already retired, a part-time side job could be a better choice.

Cut your expenses. It sounds painful and so not fun, but it doesn't have to be. Take a look at your biggest expenses because that's where you'll probably find the biggest savings. For example, auto insurance rates have been soaring so shopping around for a new insurance company can be the fastest way to cut your bill. Also, look for ways to cut your grocery bill (despite rising inflation).