“Estate planning is an essential and everlasting gift you can give your family.” – Suze Orman.
The common question that people generally ask their attorney during the estate planning process is “Whether I should get a will or create a trust?”
Both these options will play a vital role in deciding the future of your family. It will ensure that your assets are in safe hands and pass on to the right heirs. Therefore, you must understand both the options properly and then make your decision.
It is a written document that includes the wishes of the deceased person. It generally consists of the name of the legal guardian of kids, information about assets distribution, the name of the beneficiary, and executor. In addition to this, it also includes directives about how you’d like your memorial held.
Generally, there are four types of wills:
• Simple, • Testamentary trust, • Joint, and • Living.
Every will that you create needs to go through a legal process called probate. It helps in determining whether the will is authentic or not. This process might get lengthy and sometimes even contentious. However, it will help protect your family in the future and ensure that they stay financially stable after you are gone.
But what if someone dies without intestate, i.e., without a will?
In such a situation, the property, bank account, assets, and guardianship of the minor children will be decided according to the intestacy law of the particular state. It might lead to lengthy court battles and financial struggles for the loved ones of the deceased.
Therefore, it is better to consult an attorney of your state and create a will.
Tip: To find the best lawyer, you can take the help of the internet. For instance, if you live in LA, you can search with keywords like Estate Planning Attorney Los Angeles, Estate Planning Attorney Near Me, and so on. It’ll surely help you find an experienced attorney who’ll understand your needs and provide you with a better solution.
A trust is a fiduciary relationship between two parties, known as trustor and trustee. Here the trustor gives the trustee the right to hold property or assets title for the benefit of the third party, i.e., beneficiary (generally includes kids or spouse). It provides legal protection to the property and ensures that they are distributed as per the trustor’s wish. It helps save time and reduce inheritance or estate tax that the beneficiary might have to bear in case of will.
These are generally categorized as follow:
● Living, and ● Testamentary.
A living trust becomes operational after the death of the trustor and is also revocable. However, unlike the will, the property can be transferred to the beneficiaries without probate court interference. On the other hand, a testamentary trust is more expensive. It may also include the instruction to control the assets’ distribution.
There is no need to name a guardian for your minor kids as the trust will handle it. Besides, this document is active as soon as you sign it.
Both these options are great for the safety of your family. You need to decide the one that suits your requirements. In fact, if you want, you can also choose both options; just consult your attorney before making the final decision.