Wills & Trusts
No matter your net worth, estate planning is essential to ensure your goals are met during incapacity and after you pass away. Estate planning can help minimize disputes among family members, reduce taxes, shorten or eliminate the probate process provide asset protection for beneficiaries, and provide you with the peace of mind knowing all this will be taken care of. Each plan is unique, but just about every plan includes either a will or a trust as the foundational piece of the plan. Both wills and trusts are instruments used to transfer your property to beneficiaries after death.
A will is a legal document that directs the disposition of assets owned at the time of death. A Personal Representative (executor) is nominated to be responsible for filing the will with the Probate court, paying creditors, filing tax returns, and distributing the remainder of the property to the beneficiaries named in the will. A guardian is named to take care of minor or disables children. A trustee may be named to manage the money you leave for the children’s benefit, unless a trust is established. For some, a will can accomplish their goals as the centerpiece of an estate plan.
Trusts are utilized by many to achieve objectives. Trusts direct the disposition of property and can provide more flexibility and options than wills. There are various types of trusts, and all will have a trustee and beneficiaries.
Unlike wills, trusts can avoid a court probate entirely, which means saving money and time during administration. Trusts can also provide asset protection on the inheritance left to your loved ones, protecting it from life circumstances such as divorce, bankruptcy, creditors, lawsuits, nursing home care, or even themselves (bad spending habits, substance abuse issues, etc.). Some Trusts are designed to reduce estate taxes for future generations.
If you have children, or other young beneficiaries, you will need to decide when the trust property will be available for the beneficiaries to access and control themselves, if ever. For those with minor beneficiaries, the assets are typically held in trust until the youngest child has completed college or reached a certain age.
Revocable Trusts are frequently used as the centerpiece of an estate plan. They can often be changed during the lifetime of the Trustmaker. Irrevocable trusts can be used to protect assets from potential nursing home costs or to minimize estate or income taxes. Common irrevocable trusts include asset protection trusts, Medicaid, insurance trusts (ILIT), , charitable trusts (CRT, CLT, CRUT, CLAT, etc.), and trusts for children and/or grandchildren.
Each client is unique and no one technique works for everyone. The centerpiece of your estate plan will be determined by your goals, your beneficiaries, what type of property you own, and the value of your property.