The Joint Investment Conundrum: Will Or Won't?

A joint will is a shared legal document that is executed by two or more people, typically spouses, and serves as the last will and testament for all parties involved. It merges the wishes and the assets of two people into a single document. While joint wills can simplify the will-making process to a degree, they can sometimes result in mistakes or cause problems for the surviving spouse or will maker.

Joint wills are generally designed for married couples but can technically be created with a parent, sibling, child, or anyone else. They are revocable while both partners are alive, meaning that they can be revoked or modified as long as both parties are in agreement. However, when one partner dies, the joint will automatically becomes irrevocable.

Joint tenancy is a type of property ownership where two or more people purchase a piece of property, real estate, business, or asset, and each co-owner has an equal interest in the purchase and any benefits. Joint tenancy commonly affects real estate, but it can also apply to the purchase of personal assets, businesses, and bank accounts.

Joint wills are not legal in all states

While joint wills can be a convenient option for married couples, they are not legal in all states. In some states, such as Wisconsin, joint wills are not permitted. If a couple in one of these states creates a joint will, a probate court will attempt to separate it into two individual wills. If the document is written in such a way that it can only take effect upon the death of the second spouse, the court will refuse to admit it to probate.

The legality of joint wills varies across the United States, and it is important to check the specific laws in your state before creating one. In states where joint wills are not allowed, creating one could result in unnecessary complications and expenses. For example, the court may need to separate the joint will into two individual wills, which could delay the probate process and create additional costs.

Additionally, joint wills can create issues for the surviving spouse, as they are often irrevocable. This means that the surviving spouse cannot change the terms of the will, even if their circumstances change. For instance, the surviving spouse may be restricted from selling or transferring property, creating a trust, or adding or removing beneficiaries.

Due to these potential issues, estate planning lawyers typically advise against joint wills and recommend separate wills or living trusts, which offer more flexibility and control. Separate wills allow each spouse to have their own will, which can be revoked or changed as needed. This ensures that the surviving spouse can adapt to changing life circumstances and makes it easier to manage assets.

Joint wills can be separated or invalidated by probate judges

Joint wills are generally not advisable and are usually discouraged by lawyers. This is because joint wills can be separated or invalidated by probate judges.

A joint will is a single will that is signed by two people, usually a married couple, leaving all their assets to each other. It is designed to be used by married couples but can technically be created with any other person. A joint will is like an irrevocable contract—once the first spouse passes away, the second spouse cannot change the joint will, even in the case of changed circumstances. This inability to change a joint will after the first spouse dies could have assets and property tied up for years. The surviving spouse may not be able to downsize the marital home or sell it to pay for assisted living or expenses.

Many probate judges do not like joint wills and often separate the will for each party or even invalidate the joint will. This is because joint wills can tie the surviving spouse's hands on even jointly-owned property during their lifetime. The survivor might not be able to give an adult child some of their inheritance early, help grandchildren with college expenses, or sell the family home and buy something smaller.

Some states do not allow joint wills. If presented with a joint will, a probate court in these states will try to separate the document into two separate wills. If the document is written in a way that it can only become effective when the second spouse dies, the court will refuse to admit it to probate.

While joint wills can simplify the will-making process to a degree, they can sometimes result in mistakes or cause problems for the surviving spouse or will-maker.

Joint wills are irrevocable after the first spouse's death

A joint will is a single will that is signed by two people, usually a married couple. It is a binding legal contract that cannot be revoked or changed after one spouse has died. This means that joint wills are irrevocable after the first spouse's death.

Once the first spouse dies, the surviving spouse is locked into the terms of the joint will, which often has unintended or inflexible results. For example, the survivor may be restricted from taking actions such as:

• Giving an adult child their inheritance early, perhaps to buy a house or start a business
• Helping grandchildren with college expenses
• Putting restrictions on money that will be inherited by a financially irresponsible child
• Selling the family home to buy something smaller or moving into an assisted living facility
• Selling or giving away other assets covered by the will

The inability to change a joint will after the first spouse's death could have assets and property tied up for years, preventing the surviving spouse from downsizing or selling the marital home to pay for assisted living or other expenses. It also prevents the surviving spouse from changing beneficiaries, so if they remarry, their new spouse and stepchildren cannot inherit assets listed in the joint will.

Joint wills can cause issues with inheriting for blended families

Joint wills can be a good option for couples who agree on how they want to distribute their assets after they pass away. However, they can cause issues for blended families, where one or both spouses have children from a previous marriage. Here are some reasons why:

Disinheritance of Stepchildren

One of the main issues with joint wills in blended families is the potential disinheritance of stepchildren. In a joint will, spouses typically leave all their assets to each other and then to their common children. However, if the surviving spouse changes their will after the first spouse's death, they may choose to exclude the stepchildren, leaving them with nothing from their parent's inheritance. This often happens when there is a distance between the stepchildren and the surviving spouse or when the surviving spouse has their own children to care for.

Inability to Change the Will

Joint wills cannot be changed or revoked without the consent of both spouses. Once one spouse passes away, the will becomes irrevocable. This can restrict the surviving spouse's ability to manage assets, such as changing how children will inherit or selling the marital home. It may also prevent the surviving spouse from making legitimate changes to their will after the first spouse's death.

Impact on Inheritance for Biological Children

In a joint will, if the first spouse to pass away leaves all their assets to the surviving spouse, it may impact the inheritance for their biological children. The surviving spouse may choose to favour their own children when updating their will later, leaving the biological children of the first spouse with a smaller share of the inheritance. This can create friction and disputes among family members.

Challenges in Estate Planning

Joint ownership of assets can make future estate planning more challenging. The type of tenancy established can result in the family home or business going to someone who is not familiar with running it or who was not the intended beneficiary. Additionally, joint tenancy can lead to missed tax breaks for heirs or beneficiaries. When a surviving owner chooses to sell a co-owned property, they do not benefit from the same tax break as they would if they inherited the property through a will or trust.

Joint wills can be a good option for married couples with a simple estate

A joint will is a single will that two people, typically spouses, create to handle the distribution of their assets once they pass away. It merges the wishes and the assets of two people into a single document. Joint wills can be a good option for married couples with a simple estate as they simplify the will-making process to a degree. However, it's important to note that not every state allows for joint wills, and there are some potential problems with this approach.

One of the main benefits of a joint will is that it creates finality regarding what happens to your assets after you pass away. It cannot be changed or revoked without the consent of both will makers, providing reassurance that your wishes will be respected. Joint wills can also offer the surviving spouse peace of mind that they will be able to retain property and assets accumulated during the marriage. Additionally, a joint will agreement can ensure that your children inherit your estate according to your wishes, even if one spouse were to remarry.

However, joint wills can sometimes create issues. While a joint will is revocable as long as both spouses are alive, it becomes irrevocable once one of them passes away. This could restrict the surviving spouse's ability to manage assets, such as changing how children will inherit or selling the marital home. Another potential problem arises if you name someone other than an individual as a beneficiary. For example, if you plan to leave assets to a charity and that charity shuts down, your loved ones may encounter difficulties during the probate process when distributing your estate.

In summary, while joint wills can be a good option for married couples with a simple estate, it's important to understand the potential pros and cons before deciding if it's the right choice for your situation. It's always a good idea to consult with an estate planning attorney or financial advisor to ensure that your estate planning goals are met in the most effective way.

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