Are you ready to create an estate plan to dictate how your assets will be distributed to your loved ones after you pass away, but still unsure whether to use a Trust or Will as the foundation for your estate plan? Here is why a Trust may be the best option:
Probate is the court-administered process by which ownership of your assets is passed to your heirs and beneficiaries after you die. The probate process takes 1 – 2 years, on average, and can cost $2,000 to $3,000 in filing and legal costs, even for a modest estate.
With only a Will or no Will at all, anything you own solely in your own name must go through probate. One of the best things about using a Trust for estate planning is that assets held in your Trust will bypass probate and pass directly to your beneficiaries, saving your estate and your loved one’s money, time, and hassle.
Providing For A Loved One With Special Needs
Certain types of Trusts can be used to provide the resources needed to support a loved one with special needs, without jeopardizing their eligibility for needs-based public benefits, like Social Security and Medicaid. In this way, you can ensure that your loved one enjoys the quality of life you want them to have, while still receiving the benefits they need.
By avoiding the need for a long, drawn-out conservatorship process, a Trust can provide more seamless management of your assets in the following situations:
- You become incapacitated, or otherwise no longer able to manage your own affairs; and
- You die leaving assets behind for minor children;
If you become mentally incapacitated, or otherwise unable to handle your affairs, someone that you have named as a Successor Trustee can step in to manage your affairs without the need for a conservatorship. Similarly, since minors cannot inherit from your estate directly, your Successor Trustee will already be in place to manage the funds and assets you leave behind for them.
The power of a Trust lies in the amount of control it affords you. You can put money and important assets that you want your loved ones to inherit into a Trust that you create, and after you pass away, all of these assets can be dispersed to your beneficiaries, at whatever age you decide, or even in annual increments.
A Will must be probated before it can direct the distribution of your estate, which can expose the details of your estate to the public. But holding property in a Trust avoids probate, and can provide your family with more privacy with regard to the dispensation of your estate. Also, if you own property in multiple states, a Trust can be used to avoid the need to file a separate probate in every state where you own property.
Using a Trust for estate planning can help your estate avoid court involvement and legal expenses after you die. It can also minimize the time it takes for your assets to be passed on to your loved ones.
What’s more, when you use a Trust in combination with other important estate planning documents, like a Will, and Power of Attorney, you can ensure transparency in the distribution of your estate, and give your family the security and peace of mind it rightfully deserves.
For more information regarding Trust planning, consult with an experienced estate planning attorney.
Our law firm has assisted Trustees with meeting their responsibilities for many years. Let us know if we can assist you as well. Call us today or visit our contact page to arrange a free consultation with a qualified trust and estate planning attorney.