Legal Tips and Resources
The older you get, you may start to think more and more about providing security for your loved ones. When you die, you don’t want your property to end up in the wrong hands. You certainly don’t wish for your family members to be left in a bad financial position. Establishing an estate plan is critical, and wills and trusts are part of this process. It’s helpful to understand how these work and the benefits they provide.
A will is a legal document that takes effect at the moment you pass away. In this document, you will designate beneficiaries and a legal representative who makes sure your wishes are carried out. In the will, you will name various possessions and property and where they will go after your death. The will deals with your financial accounts, including checking, savings and retirement. it also spells out who will take care of your financial obligations. Your will includes that property in your name, which you will pass to heirs. Your will has to pass through probate when you die.
A trust is similar, in that you will name an executor and legal beneficiaries to inherit insurance payouts. However, the trust will become valid at the time you write it. This means from this moment, you can begin to distribute any property into the hands of those you designate. In a trust, your property will not automatically pass to heirs unless you name them in the document. People like trusts because they do not go through probate processes after your death.
Which Should You Choose?
There is not a clear-cut answer for everyone. Your choice of whether to set up a trust or write a will depends on your needs, preferences and circumstances. You have more control over your assets in a trust and can begin to set things in motion while you are still alive. However, a will can be easier to establish. Plus, there is less of a financial commitment in writing a will.
What To Do Next
Before you move forward with your estate plan, speak with an estate planning lawyer. Your lawyer has the knowledge and training to advise you on what makes the most sense for you and your family.
Now that you have some understanding of wills and trusts, meet with a lawyer. Give yourself some financial peace of mind and provide better security for your family members.