Should I Have a Will or a Trust?
June 29th, 2018
While the will is a very basic estate planning tool that is fundamental to any comprehensive estate plan, a trust can offer significant advantages that a will does not. As a result, depending on your situation, a trust may be a valuable part of your estate plan. Additionally, in most cases, an estate plan containing both a will and a trust is the best way to ensure that your assets are distributed as you intended, as well as to avoid the costly, time-consuming, public nature of probate court proceedings.
A will is a legal document that sets forth how you wish all of your property to be distributed following your death. In a will, you appoint a personal representative, who is responsible for carrying out the directives in your will, as well as beneficiaries, who are the people you choose to receive your property. You can include all types of assets in your will, including real estate and personal property.
One of the biggest downsides to a will, however, is that your personal representative is likely to be required to file an estate to distribute the property listed in your will. Probate can be lengthy and costly, as your personal representative will have to get court permission to take certain actions, such as to pay your creditors and distribute your property as your will dictates. A will that is admitted to probate also becomes a public record, which will allow the general public to read your will and how you have chosen to distribute your property. However, if you choose to use a pour-over will in conjunction with a trust, any property governed by your will simply will pour over into your trust and then be distributed according to the terms of your private trust, rather than requiring probate proceedings. This is one example about how you can use a will and a trust together to provide you with a sound and effective estate plan.
While probate isn’t always avoidable, a trust can be a good way to remove your property from your probate estate and have it distributed according to your instructions as set forth in a private trust document. Trusts can take a variety of different forms, depending on your estate planning needs. Essentially, you transfer your property to the trust, which is governed by a person whom you choose to be trustee. That property then passes to your named beneficiaries following your death according to the terms of the trust, altogether bypassing probate court.
The estate planning attorneys of Legacy Law Center are here to help clients navigate through the estate planning process in order to adequately address all of their issues and concerns. With our skills, experience, and knowledge, we can help you make the estate planning decisions that will best benefit you and your family. Contact us at our Ann Arbor office today and find out how we can assist you with your needs.