When planning for the future, you need to understand the tools available to protect your assets and provide for your loved one. Two primary estate planning tools are wills and trusts, and each serves distinct purposes and offers unique benefits.
A will is a legal document that outlines how your assets should be distributed after you pass away. This document lets you name beneficiaries, designate guardians for minor children, and specify funeral arrangements. All wills must go through probate, which is a court-supervised process that becomes a matter of public record.
In comparison, a trust is a legal arrangement where a trustee holds and manages assets for the benefit of a beneficiary. Trusts can be structured to take effective immediately or upon death. One of the main advantages of trusts is that they can bypass the probate process, allowing for a quicker and more private distribution of assets. Additionally, living trusts offer the benefit of managing assets during your lifetime, providing a plan if you become incapacitated.
When comparing wills and trusts, wills are typically simpler and less expensive to create, but they do not offer the same level of flexibility and control as trusts. Trusts can be tailored with specific instructions for asset distribution, such as distributing assets at certain ages or milestones, but they are usually more expensive to establish and maintain.
We help our clients create both wills and trusts at our law firm. For more information about these two estate planning vehicles, contact us today.