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14
WILLS AND TRUSTS
NATIONAL MAKE A WILL MONTH.
Did you know that August is national make a will month?
WILL AND TRUST.
Will
Definition: A will is a legal document that specifies how you want your assets to be distributed after your death. It also can name guardians for minor children.
Effective Date: A will only takes effect after your death. It does not provide any benefits or legal authority while you are alive.
Probate: A will typically must go through a legal process called probate, where a court oversees the distribution of the estate. This process can be time-consuming and costly.
Privacy: Wills become part of the public record once they are probated, so their details can be accessed by the public.
Flexibility: Wills can be changed or revoked at any time before your death if you are mentally competent.
Trust
Definition: A trust is a legal arrangement where one party (the trustee) holds and manages assets for the benefit of another party (the beneficiary). There are several types of trusts, like revocable trusts and irrevocable trusts.
Effective Date: Trusts can be effective during your lifetime (living trusts) or after your death. Assets in a trust can be managed and distributed according to the trust's terms while you are still alive.
Probate: Assets in a trust typically do not go through probate, which can make the process of transferring assets quicker and more private.
Privacy: Trusts remain private, as they do not become part of the public record.
Flexibility: Revocable trusts can be changed or revoked during your lifetime. Irrevocable trusts, however, cannot be easily modified once established.
Key Considerations
Complexity: Trusts can be more complex to set up and manage compared to wills, often requiring professional assistance.
Cost: Setting up a trust may involve higher initial costs, but it can save money in the long run by avoiding probate fees.
Control: Trusts offer more control over how and when your assets are distributed. For example, you can specify that assets be distributed in stages or upon certain conditions being met.
In summary, a will is simpler and provides a clear plan for the distribution of assets after death, while a trust can offer more flexibility and privacy, and can help avoid probate.
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