Choosing how to structure your estate plan ultimately dictates how your legacy will be handled when you pass away. One of the most common questions people ask when starting their plan is whether to rely on a will or a trust to protect and transfer assets to their chosen beneficiaries.
The fact that you’re here is a good starting point. It’s best to make informed decisions to better preserve and prolong your legacy through effective estate planning. Deciding between a will or trust comes down to a few notable factors: type of assets, privacy, and flexibility.
Wills Are Simple, Affordable Documents
If you have a “small” estate and don’t have many complex property needs to cover, a will may make the most sense. These documents are simple and allow you to dictate the direction of assets and accounts without the expense of a far more involved trust.
Unfortunately, a will ultimately still ends up in probate court—which adds time and costs to your beneficiaries along the way. The state will examine the contents of your will and verify not only its validity but the legality of your wishes. In some cases, people are surprised to find that the state rejects some or all of the details of a will and makes its own decisions about the estate.
Trusts Separate Assets from the Estate, Keeping Them Out of Probate
Probate can be a headache for families.The public probate court process requires significant time and puts critical decisions about the distribution of your property in the hands of the State. This adds stress in a time that’s often marked with mourning the loss of a loved one.
Probate can also become a significant financial burden, tying up assets and adding unnecessary financial expenses while also consuming the time and resources of your loved ones. My goal is to help families set up an estate plan to smoothly transition their property, minimize delays, and keep the process private, secure, and out of the courtroom. By avoiding probate, clients save time and money —both invaluable resources when it comes to protecting what matters most and keeping your family moving forward.
With a trust, you are able to keep your estate out of probate. Assets transferred into a trust are considered separate from your estate and won’t factor in should probate be necessary. Instead, the details and transfer of those assets are kept private and handled as you see fit. There are a variety of ways a trust may be used, which is why it is important to work with an estate planning attorney in who understands how to properly structure and execute one for you.
Trusts Allow for Greater Flexibility for Complex Estates
While nobody can force you to structure your estate in one way or the other, relying on a trust is far more sensible for those with more complex or expensive estates. Those with property ownership rights in multiple states or who own business interests, for example, should use a trust to avoid forcing loved ones to open probate in multiple states.
The same is true for those who have a high net worth and prefer privacy. What happens in probate court is public information which means transferring ownership of assets would be known to anyone who is willing to inquire. This exposes your legacy and your beneficiaries to predators they would otherwise avoid through the use of a trust.
Most Estates Use Both
Here’s the caveat to the entire conversation: Most estate plans include both a will and a trust(s).
these are just a few of the several differences between wills and trusts. It’s best to be prepared for all possible outcomes and circumstances so your legacy isn’t held up in the legal process. You need an estate planning attorney who understands the holistic approach to estate planning. Whether you’re just starting your plan or need help updating a plan that’s already in place, contact LT Fobi Law to get started.
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