Deciding what to place in a will and what to place in a trust can be confusing, but it doesn’t have to be. By keeping a few guidelines in mind, you’ll have a better idea of what sorts of things go in a will and which are better suited for a trust. Getting a handle on the basics will help you better understand the estate planning process.
What’s in a Will?
First, let’s talk about wills and their role in estate planning. A will is a legally binding document outlining what you would like done with your assets and property after your death. A will outlines who gets what from your property and savings. This covers everything from the house and car down to the smallest collectible you would like a certain someone to have. A will is also the place to name your chosen guardian for your children.
You will also need to appoint an executor of your estate. This person is responsible for overseeing your estate after your death. They are also the person assigned to carry out your final wishes.
When naming beneficiaries, you can leave specific instructions in your will stating how and when beneficiaries will receive the assets or items from your estate.
After your death, it is the role of the probate court to authenticate your will. The court will also ensure that the wishes outlined in the will are fulfilled.
What’s in a Trust?
A trust is different from a will and involves assigning a trustee to oversee the trust. Generally, a trust is set up by a third party. This arrangement protects your assets while avoiding probate court and its associated costs. An additional benefit of a trust is that it will keep your estate affairs private.
When estate planning, you will need to consider taxes. Having your assets in trust can provide significant tax savings when assets are passed to the beneficiary.
To find out more about what to include in a will or trust, schedule a consultation today.