You have worked day and night to earn money and saved it diligently whenever you had the chance to accumulate your assets. It is only natural for you to wish to have control over the distribution of your estate after your death. For this purpose, you need to have an estate plan in place to ensure that everything goes as you have wished and in a timely manner.
Living trusts and wills are two important estate planning tools that enable people to transfer their estate according to their wishes after death. Both have significant differences and choosing any one of them largely depends on your individual circumstances.
To develop a better understanding and decide the best option, here is how living trusts and wills work, along with their advantages and disadvantages.
It is a legal document that helps in lifetime and after-death estate management. It becomes valid when you decide to put it in effect and the rights of your assets are transferred accordingly. Being the trustee and grantor of your living trust, you can assign a trustee who will be given authority of your estate after your death without any intervention of the probate court. Moreover, you can manage and update your living trust from time to time while you are alive.
- As it doesn’t require the trustee to go through probate, it is quite cost-effective and also saves time which would otherwise be wasted in court proceedings.
- It keeps your financial affairs private by avoiding probate.
- At the time of distributing assets, the inheritors don’t have to hire a lawyer.
- The management of your estate is immediately transferred to the trustee if you become physically or mentally disabled or incapacitated.
- The initial paperwork and calling your estate planning attorney every time you need to make changes to your living trust can be expensive.
- A living trust requires you to transfer the ownership of your estate in the trust.
- You cannot choose a guardian for your children.
- Refinancing property that is transferred in the trust can become difficult.
It is a written document that you must sign in the presence of witnesses. It includes details of how your estate will be divided after your death. You can make changes to it any time during your lifetime. It is also revocable.
- The process of setting up a will is quite straightforward and is cost-effective as compared to a living trust.
- You can choose a guardian for your children.
- You don’t require changing titles and transferring property to another entity.
- In order to implement the will, the beneficiaries have to go through probate, which is a slow and costly process.
- Your financial affairs become public due to court proceedings.
- You need to hire a lawyer to execute the will.
- A will doesn’t provide the option of transfer of management of estate if you become incapacitated.
Consult with an Estate Planning Attorney Today
If you want to know whether you should make a will or a living trust to distribute your assets, it is essential that you seek legal assistance of a reliable and experienced estate planning attorney. For more information regarding estate planning matters, you may call the Jackson Abdalla Law Group today at (773) 550-3853.