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Estate Planning: Wills Vs. Trusts

Estate Planning: Wills vs. Trusts

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Wills and trusts are two estate planning tools you can use to protect your legacy, provide for your family, and ensure that your wishes are properly carried out after you pass away. To determine which option best suits your needs and goals, you need to understand the distinct advantages of wills versus trusts.

With so many estate planning options at your disposal, you will most likely need the help of an experienced legal professional to decide which choice is right for you.

What Is a Will?

Some overlap exists between wills and trusts, but there are also some important distinctions. Wills are essentially just a legal document that allows you to make your last wishes known.

In a will, you can designate a guardian for any minor children you have, name your beneficiaries, and outline how you want your property and assets to be distributed. You can also use your will to name an executor. This trusted individual would be responsible for the administration of your estate after you pass away.

Unlike a trust, a will cannot go into effect until after you pass away. One drawback to wills is that they often have to go through probate.

What Is a Trust?

Trusts are slightly more complex than wills, but they can be advantageous for numerous reasons. Unlike a will, a living trust goes into effect as soon as you create and fund it. By placing assets in a living trust, you can have more control over how those assets are distributed upon your passing. There is a broad range of trust types, from special needs trusts to charitable trusts, and an attorney can help you determine which type of trust works best for your situation.

For a living trust to work, you must fund it while you are still living. You can do this by transferring assets into the trust. You will also need to appoint a successor trustee who can administer the trust after you pass away.

Advantages to Each

It can be extremely beneficial to set up both a will and a trust as part of your estate plan. One is not necessarily better than the other, and they can both work together to make the transition of your assets easy for those you leave behind.

The main advantage of creating a will is to make your final wishes known to your loved ones and to the court since most wills have to go through the probate process. There are different types of wills, but one of the most effective is known as a pour-over will. Essentially, a pour-over will ensures that any assets you own that have not been transferred to your living trust at the time of your death are placed into the trust.

One of the primary benefits of establishing a trust is that, unlike a will, a living trust generally does not have to go through probate. This means that the assets you place in the trust can be swiftly distributed to your chosen beneficiaries and do not become a matter of public record. Probate can be a long and costly process, and establishing a living trust helps your loved ones avoid the stress of legal proceedings while they are grieving. Additionally, a trust can help protect their privacy.

An Estate Planning Lawyer Can Help

Many people assume that estate planning is for elderly individuals, but it is never too early to begin planning for the dispersal of your estate. While it can be uncomfortable to think about, each of us will one day pass away, and leaving behind a valid, legally enforceable estate plan is a wonderful way to safeguard your personal legacy.

Call 804-266-9619 to talk with a Virginia estate planning lawyer at Taylor, Taylor & Taylor, Inc. Let us go over your situation in a confidential consultation and discuss how we can help.

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