Do You Need a Will or a Living Trust?
According to a 2019 survey, 57% of adults in the United States do not currently have a will or living trust. Many of these people delay creating estate planning documents because they feel like the process is confusing and worry about picking between a will and a trust. However, it can actually be very easy to decide between these two choices as long as you consider these factors.
Privacy Preferences
When you file a will with a probate court, it becomes available to the public so that others can learn about your assets, belongings, and more. For some people, this is perfectly acceptable. However, if you care about your privacy, a living trust may be a better option. Since a living trust is a private contract made between you and the trustee, no one can read it just by pulling up basic court records. The only time a living trust would become public knowledge is if your beneficiaries choose to take it to court later on to contest something.
Convenience
Which option is more convenient will mainly just depend on whose convenience you wish to prioritize. A living trust does not have to go through probate, so it is often a lot easier for your beneficiaries to handle. The ability to skip hours spent with estate planning litigation lawyers in probate can also mean that your inheritors can save plenty of money if you have a lot of wealth to pass down. However, setting a trust up in the first place can take a little more time and money, and altering it can also be more difficult.
The Location of Your Assets
A frequently overlooked factor in choosing between a will and a trust is the location of all your assets. If you own real estate, buildings, or businesses in multiple locations, getting an estate planning litigation lawyer to help set up a trust is probably the better choice. This is useful because it ensures that your inheritors do not have to handle probate and other red tape for each individual state where the assets are located.
Your Health
A big advantage of a living trust is that it can also detail how you want things handled if you become ill, get dementia, or are otherwise incapable of caring for yourself. You can pick a spouse, child, or friend who can handle your property if you are incapacitated. This ensures that your wishes are still met even if you can no longer express them. Since it lets you avoid ending up stuck in a court-supervised guardianship, a trust is an excellent choice for older people and those in poor health.
Marital Status
Those who are married and have estates over the federal estate tax exemption can use a living trust to take advantage of both spouses’ estate tax exemptions. A trust can also be useful if you and your spouse have separate beneficiaries, especially in blended families where each partner wants to leave assets to his or her own children. Trusts may also be useful if you are a single person without family because they ensure you are taken care of if you become incapacitated.
Potential Beneficiaries
A key thing to consider when thinking about a trust versus a will is who you want to receive your property. A trust can be an excellent choice if you have minor children because it lets the trustee handle funds until your children come of age. Likewise, it can be useful if you want to use your assets to care for a mentally disabled loved one after you pass away. Trusts also allow you to set up a specific age at which your inheritor can access the funds.
Still not sure which option works best for you? The Knee Law Firm can help you decide, and we have plenty of experience crafting both types of estate planning documents. Our lawyers have more than 60 years of combined legal experience assisting with both estate and elder law. Call (201) 996-1200 today to set up your appointment at the Knee Law Firm in Hackensack, New Jersey.