Mutual Will

AAA

DEFINITION of 'Mutual Will'

A type of will, usually executed by a married or seriously committed couple, that is mutually binding. After one party dies, the remaining party is bound by the terms of the mutual will. The purpose is often to make sure property passes to one's children rather than to a new spouse. Because of state differences in contract law, a mutual will should be established with the help of a legal professional.

Though the terms sound similar, a mutual will should not be confused with a joint will.

INVESTOPEDIA EXPLAINS 'Mutual Will'

For example, John and Alice create mutual wills. John dies and his property passes to Alice. Alice takes a new husband, Jay. When Alice dies, because of an agreement made in the mutual will, her property will not pass to Jay. Instead, it will go to John and Alice's children.

RELATED TERMS
  1. Duress

    The act of using force, false imprisonment, coercion, threats ...
  2. Estate Planning

    The collection of preparation tasks that serve to manage an individual's ...
  3. Heir

    HeirA person who inherits some or all of the estate of another ...
  4. Marital Property

    A U.S. state-level legal distinction of a married individual's ...
  5. Beneficiary

    Anybody who gains an advantage and/or profits from something. ...
  6. Will

    A legally enforceable declaration of how a person wishes his ...
RELATED FAQS
  1. What is a family Limited Liability Company (LLC)?

    A family limited liability company (LLC) is formed by family members to conduct business in a state that permits such form ... Read Full Answer >>
  2. How is maintenance of standard of living for survivors accomplished in estate planning?

    Estate planning is an integral component of comprehensive financial planning, as it allows individuals and couples to maintain ... Read Full Answer >>
  3. What is the difference between an intervivos trust and a testamentary trust?

    Estate planning offers tools to establish and maintain effective control over cash, investment and real estate assets during ... Read Full Answer >>
  4. What are the differences between a Chartered Financial Analyst (CFA) and a Certified ...

    The differences between a Chartered Financial Analyst (CFA) and a Certified Financial Planner (CFP) are many, but comes down ... Read Full Answer >>
  5. What is the difference between revocable and irrevocable intervivos trusts?

    Within estate planning, individuals have a myriad of options for maintaining control over assets beyond the grave. A tool ... Read Full Answer >>
  6. How does a revocable trust become a split-interest trust?

    A revocable trust is set up during the lifetime of the grantor who begins the trust. The grantor has the right to modify ... Read Full Answer >>
Related Articles
  1. Retirement

    How To Choose The Right Executor For Your Estate

    Making a careful choice now can save your heirs from a lot of problems later.
  2. Retirement

    Why You Should Draft A Will

    Don't trust the courts to follow your wishes - plan the distribution of your own assets.
  3. Options & Futures

    Your Will: Why You Need A Power Of Attorney And Beneficiaries

    What would happen if you were suddenly unable to manage your financial affairs? Preparation is the best protection.
  4. Retirement

    Roth 401(k) Vs. Roth IRA: Which One Is Better?

    It all depends on your age, your income - and your plans for your retirement nest egg.
  5. Professionals

    How to Best Navigate Taxes in Retirement

    Here's a rundown on tax strategies that can help extend the life of a nest egg.
  6. Personal Finance

    5 Signs You Need A Postnup

    They're not the most fun thing to contemplate, but these contracts can actually help a marriage.
  7. Entrepreneurship

    MLPs: How They Are Taxed

    The advantages of MLPs outweigh the disadvantages, especially if you play your cards right.
  8. Professionals

    5 Ways to Mess Up Estate Planning

    There are several ways to make an estate plan defective, most of which can be easily avoided by periodic plan reviews.
  9. Retirement

    How To Set Up A Trust Fund In The U.K.

    A guide to the whys and wherefores of setting up this most versatile of estate-planning instruments in the United Kingdom.
  10. Professionals

    Top Retirement Planning Tips for Same-Sex Couples

    Financial advisors who work with same-sex couples need to be aware of these key factors to provide effective advice.

You May Also Like

Hot Definitions
  1. Bund

    A bond issued by Germany's federal government, or the German word for "bond." Bunds are the German equivalent of U.S. Treasury ...
  2. European Central Bank - ECB

    The central bank responsible for the monetary system of the European Union (EU) and the euro currency. The bank was formed ...
  3. Quantitative Easing

    An unconventional monetary policy in which a central bank purchases private sector financial assets in order to lower interest ...
  4. Current Account Deficit

    A measurement of a country’s trade in which the value of goods and services it imports exceeds the value of goods and services ...
  5. International Monetary Fund - IMF

    An international organization created for the purpose of: 1. Promoting global monetary and exchange stability. 2. Facilitating ...
  6. Risk-Return Tradeoff

    The principle that potential return rises with an increase in risk. Low levels of uncertainty (low-risk) are associated with ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!