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Living Trusts vs. Wills: Which Is Right for You?

When it comes to estate planning, one of the most critical decisions you’ll make is choosing between a living trust and a will. Both tools serve the essential purpose of distributing your assets after your death, but they do so in different ways and offer distinct advantages and disadvantages. Understanding the nuances of each can help you decide which option aligns best with your needs and goals.

What is a Living Trust?

A living trust, also known as a revocable trust, is a legal document created during your lifetime that places your assets into a trust for your benefit while you are alive. After your death, these assets are transferred to your beneficiaries according to your instructions. One of the main benefits of a living trust is that it allows your estate to bypass the probate process, which can be lengthy and costly. Additionally, a living trust can provide privacy since its contents are not made public record. It also offers continuity in managing your affairs if you become incapacitated, as your appointed trustee can step in and manage your assets without court intervention.

Related: “How to Set Up a Trust Fund?”

What is a Will?

A will is a legal document that outlines how you want your assets distributed after your death. It also allows you to name a guardian for your minor children and an executor who will ensure your wishes are carried out. Unlike a living trust, a will must go through probate, a court-supervised process that validates the will and oversees the distribution of your assets. While this process can be time-consuming and potentially expensive, it provides a level of oversight that can be beneficial in preventing fraud or mismanagement. Wills are also generally simpler and less expensive to create than living trusts.

Picking the Best Option

Deciding between a living trust and a will depends on your specific circumstances and goals. If you want to avoid probate, maintain privacy, and have a plan for managing your assets if you become incapacitated, a living trust may be the better option. However, if your estate is straightforward, you have minor children, or you prefer a simpler and less costly solution, a will might be sufficient. It’s also possible to use both documents in your estate plan, utilizing a will to handle certain matters that a living trust cannot, such as naming guardians for minor children.

Related: “The Importance of Estate Planning for Blended Families”

Consult With Us

At Family Law Richard E. Young & Associates, we understand that estate planning can be complex and overwhelming. We’re here to help you navigate these important decisions and create a plan that meets your unique needs. Contact us at (949) 951-9529 or visit our website at richardeyoungattorney.net to schedule a consultation and ensure your assets are protected and your wishes are honored.

What You Should Know About A Will

Planning for the future by drafting up your will can be scary, but important! If you are starting to think about this aspect of your future and want to learn more about a will, be sure to read this month’s blog post!

Separate

When it comes to creating your will, you’ll want to create one separate from your spouse. While you are married, it’s important to keep your wills separate. Naturally you are going to have different wishes and items that belong to you alone, so it’s only natural to create a will specific to you. It is also likely that your deaths will be separate. It’s common that you and your spouse will have a will that looks similar, but ultimately slightly different. 

Close Family

Once you have your will crafted, you will want to pick an executor. Normally it’s a family member who you are close with and who you trust and can rely on. Should you find this task a bit daunting or you believe your will is more complicated than most are, it’s important you make sure your attorney is the executor. There is nothing wrong with admitting it’s not good for a family member to have this job, so be sure to make the right choice! Your attorney will also be able to help you make this choice and offer their opinion. 

Letter of Instruction

Beyond your will, you will need to create a letter of instruction. These letters are less official and binding than a will, however if your family receives the letter they should be compelled to follow it. A letter of instruction can detail the aspects of your funeral and affairs related to such. You can also include details of each item you are leaving to people. You can let them know what you hope they’ll do with it. While they aren’t bind like a will, your family may find guidance in having the letter. 

Accessibility

The overall point of a will is to help your family sort all your belongings after you’ve passed. Without a will everything must go through probate and the state, which is time consuming and stressful for family members who believe something is theirs. If you create a will, and then nobody is able to find it, your family will have to go through the same ordeal as if you never had it. Ensuring that your will is easily accessible and someone who you trust knows where it’s at is essential.  

Conclusion

Nobody wants to think about their death and what comes after, however it is an essential part of your future plans. Ensuring you have a will that is easily accessible is in everybody’s best interested. For any legal questions you may have, be sure to reach out to Family Law Richard E. Young & Associates!

Why Should You Start a Trust?

While death isn’t fun to think about, it is still important to plan for those around you after you pass on. Starting a living trust is a great idea to protect your assets and property. A common debate is whether you should start a will or a trust. Today, we are going to discuss the benefits of starting a trust rather than a will.

 

Two Types of Trusts

First, there are two kinds of trusts. A revocable trust (also called a living trust) allows your assets to avoid probate after you pass, while allowing you control over these assets while you are alive. This trust offers flexibility, so you have the option to get rid of it at any time. It is not set in stone.

An irrevocable trust is more permanent and doesn’t allow you access to your assets while you are alive. It cannot be dissolved or altered until after you die. However, this makes your assets able to pass by probate and reduce the amount of estate taxes. Also, if your trust assets generate income, you are not subject to tax liability.Trust Fund

 

The Benefits of a Trust

Now that you know about the two types of trusts, let’s look at the benefits of having a trust. Trusts allow you to specify each and every term, so you can limit what distributions may be made and to whom. If you have a revocable trust, you still have access to your assets during your lifetime, so you have control in that aspect, too. Then, the remaining assets will be distributed accordingly after you pass on.

Trusts help your assets and estate avoid probate, meaning that it can be directly distributed after you pass without any taxes, fees or the hindrance from the court. Probate is public record, so a trust allows your assets to stay private. In addition, trusts protect your wealth and estate from creditors or beneficiaries who are not good at managing money or assets.

Revocable trusts allow you to name your family members or other trusted individuals to have authority over your assets if you somehow become unable to manage your estate – wills do not let you do this.

Conclusion

It is important to have either a trust or a will because without them, your property will be distributed according to the state laws that remain out of your control. However, a lot of people find that a trust works better for them and their specific situation. Your age, wealth, and marital status help determine whether or not you need a trust.

If you need help planning a trust, or if you are trying to figure out if a trust is right for you, contact us at Family Law Richard E. Young & Associates!