In another post, I talked about why a Will is not the best tool to address your concerns for quickly transferring your assets, keeping your estate private, or properly leaving money to minors.
A Trust, however, does address these concerns. Here’s how:
1. Asset Management
If you have heirs who are minors, leaving their share in a trust allows someone to manage and invest their inheritance for them until they reach the age you specify for receipt of their entire inheritance.
Additionally, if you have disabled heirs, leaving them an inheritance outright in a Will can cause them to lose their needs-based disability income. However, if you leave their share with a Trust, there is no interruption of their benefits.
2. Probate Avoidance
While a Will guarantees your family will have to deal with the probate court, a Trust ensures that your family will NOT have to deal with the probate process. Avoiding probate saves your family money and time.
3. Avoiding a Court-Ordered Conservatorship
A Will is a death document. It only becomes effective at your death. It does nothing for you while you are alive. Should be you become disabled and unable to manage your affairs, a Will won’t help you. Your family will need to petition a court to get guardianship over you and your estate. On the other hand, a Trust allows you to provide for someone to take over for you without court intervention.
Example: If you develop dementia, the Trust has a provision that allows a successor trustee to manage the Trust. This advantage helps you avoid the expense and embarrassment of court supervision.
A Will guarantees that your estate will go through Probate Court. Probate is a public process that allows anyone to see what you own and who gets your estate. A Trust does not require probate, so your assets pass to your named beneficiaries in a completely confidential manner.
5. Low Cost
The probate process can be an expensive process that prolongs the distribution of your estate. The expense comes in the form of legal fees for lawyers to take your estate through the probate process. With a Trust, there are few, if any, legal fees for settling your estate. If you leave real property to someone, there will be minor legal costs for drafting and recording deeds, but those fees are a tiny fraction of what probating your estate will cost your heirs.
To help you understand the various things you should consider in preparing your Estate Plan, I offer a no-cost Peace of Mind Planning Session in-person, via Zoom, or on the telephone. In addition, you can access my calendar and schedule your free session by clicking the link below:
Schedule Your Free Peace of Mind Planning Session
You can also register for my Estate Planning Webinar: Register for Webinar