Because of increases in some states in the use of trusts in place of a traditional Will, many of our clients often ask which is better, a trust or a Will? To answer this question, it is important to consider the attributes of each:
What Is A Will?
A Will is a document that a person executes during their lifetime to go into effect only upon their later death. The Will can serve several purposes: it can lay out how the person’s assets will be divided upon death, it can appoint a guardian of the person’s children, and it can appoint a trustee to manage the person’s assets for his minor children.
What Is A Living Trust?
A living trust is generally perceived as a substitute for a traditional Will. The trust is created during a person’s lifetime, and all of that person’s assets are transferred into the trust when it is created. Thereafter, the trust can be amended, changed, or revoked at any time prior to the person’s death. However, when the person dies, the assets in the trust will be distributed pursuant to the terms of the trust agreement, rather than according to the provisions of a Will. In some states, the probate laws are so difficult that the living trust eases the process at death of distributing assets. In Texas, however, as a general rule, the living trust provides only limited benefits over a traditional Will.
The selection of the best method for handling your assets upon death, either by Will or by Trust, is a question that requires solid consultation with a qualified attorney. Should you be wrestling with this question, please contact us so that we may help you understand all of the considerations involved in making this decision.
While some relationships ultimately bring the phrase “trouble in paradise” to mind, there is often less paradise and more trouble when it comes to the Kardashians. Kim, Khloe and Kris have gone through divorces on the family’s reality show, and they serve as a reminder to those in Texas and other states to update estate planning documents when life changing events happen like new additions to the family, divorce or remarriage.
The National Law Review pointed out an instance where Kris told her ex Kaitlin Jenner that she had updated her living will to appoint a new executor. Changes like this are necessary so that someone more appropriate than an ex can make important health decisions if oneself is no longer able to do so.
The NLR points out that Kris may have gotten some of the terms wrong, but one may need to make several additions to a will or trust when divorce occurs. The executor of an estate is who helps carry out a will when a person passes away while a Health Care Power of Attorney or Advance Health Care Directive might be included in a living will to name an agent who can make health related decisions for a person.
Some people choose to use trusts because wills go through the probate process while trusts do not. This often gives a family more privacy when a loved one dies and may come with less tax burdens. When establishing or editing estate planning documents, contact us so that we can help ensure that your wishes are clear and enforceable.
Creating a trust is probably the last thing you have on your mind, especially with the upcoming holidays. With the challenges of your daily home life and work life, you probably feel that you are far too busy to sit down and discuss setting up a trust for your family in case something unfortunate happens to you.
If you do not properly set up your trust, your family could go through a difficult time because of the constant legal problems they may face. If your family members do face legal problems because of the trust not being set up properly, this could mean the trust will be mismanaged. This is why it is so important to take the necessary steps to ensure your trust will be handled correctly from the beginning.
Your trust will be extremely useful, especially if your children are minors. When you leave a trust for your minor children, you will be setting money aside for them that they can have access to when they get older. You can decide at what point or points your children can have access to the money you have left for them.
When you have a trust, you can also determine how your children’s money will be disbursed to them. If you want your children to have all their money at one time, you can choose to put that information in your trust. If you do not have any children, but you have a favorite charity, you can have your money go to that charity.
Taking the time to prepare a trust is something you may have been putting on hold, but you should not put it on hold anymore. If you have an untimely death with no trust, your loved ones may not know how they can protect your properties and your estate. We understand this is not something fun to do, but it helps to have someone on your side.
Contact us today if you need to prepare a trust.
Did you know that less than half of American adults have developed documentation as part of the estate planning process? Binding legal agreements are critical to ensuring that your asset distribution wishes are met after your death. The two major documents from which to choose are trusts and wills.
Depending on your financial assets, situation, and complexity, it is often appropriate to go with a living trust for estate planning purposes. Following are 3 major benefits:
Did you know that a will can publicly published once filed with the Court? As it goes through probate court proceedings, it becomes a public court record. This may pose an issue if you prefer to keep the details of your asset distribution confidential. A living trust allows you to do this. Because a living trust is not filed with the court, it is only available to the person who develops the document and the assigned Trustee.
A living trust can be put to work without having to go through lengthy and potentially costly probate court proceedings. A will, however, requires probate court proceedings to ensure that all assets are distributed as documented. Eliminating probate proceedings will save your heirs time and money, providing faster access to funds and saving the attorney and court fees required for probate.
Protect Any Disability
A will only instructs heirs in the event of your death. A durable Power of Attorney can be added, but this does not allow for maximum control either as not every financial institution will recognize it. A living trust, however, provides instructions to your Trustee in the event that you become disabled, extremely ill, or incapacitated.
There are additional reasons why a living trust may be a better estate planning solution over a will, but much depends on your personal financial situation. Be sure to discuss these matters with a trusted attorney to identify the best solution for your particular needs. To learn more about how we can help, please contact us.