Estate planning can be confusing. Often when we think about estate planning we think of someone with a lot of money, not someone that we identify with ourselves. We picture this person who looks nothing like ourselves sitting down and dictating their wishes to their trusted advisor or attorney telling them what they want to have happen with their property when they die - recording their final wishes. Then we see the family gathered in front of the attorney in the fancy office as the will is read. But estate planning is not just for the "other people" out there, it is something for all of us.
For anyone who has started considering the need for estate planning the question is always "Do I need a will or do I need a trust?". Sometimes we get to this question after we figure out what the difference is between a will and a trust, sometimes we ask this question before we know the difference. Since the answer to the question of will vs. trust depends entirely on the difference between the two, we'll start there in deciding which to prepare.
A will is a document that starts working when the author passes away. It identifies who they want to receive their property and who they want to raise their minor children (if they have any) after they are gone. It is a document that requires the use of the courts to make it effective - the court will oversee your wishes being carried out, your minor children being settled with their guardians, the creation of a trust for your children and your property being distributed to your heirs.
A trust is similar to a will in that it also lays out where your property and your minor children will go, but it does so without the use of the court system (except for the settling of minor children, the court always oversees that). With a will the court is involved in every step of the process, while for a trust the court's involvement is very limited. A trust is different in that it often covers more issues than a will and it has the ability to continue to make decisions into the future.
The ability to carry decisions into the future is one of the biggest benefits of a trust when you have minor children. Not only are you able to control who gets what, but you are also able to control when they get it. You can decide that your children should receive their inheritance from you not as a lump at the age of 18, but instead you can spread it out over many years so they have fallback in the future once they become wiser in their spending habits and life decisions.
A will can be very effective if you have no children and no property, just personal belongings. It makes it clear to the people you care about what you want to have happen with your property and your remains. Since it has complete court oversight any squabbles that arise are sorted out by an impartial judge. If it is used when you have very little property to transfer, the cost can be minimal.
The ultimate decision of will vs. trust depends on many factors, and belongs to each of us. Doing so with the help of a compassionate estate planning attorney can turn a confusing process into a satisfying expression of love for the life we have lived and for the people we have been fortunate to share it with. Reach out to the Law Office of Michelle D. Smith today to learn more and get started.
Disclaimer: Michelle D. Smith is a California Licensed attorney, SBN 233515. The materials contained on this page is for general informational purposes, it should not be considered formal legal advice and does not create a formal lawyer/client relationship.
