Estate Planning and Probate Series
An Introduction to Estate Planning
If you’ve been keeping up with our newsletters, then you know we’ve been sharing tips and resources related to Estate Planning (Tax Smart Estate Planning and Don’t Put It Off). The topics received such an enthusiastic welcome and encouraged so many questions that we’ve decided to explore Estate Planning with a summer series, Estate Planning and Probate: Tips and Tales.
In the series, we’ll share estate planning tips and resources, as well as stories and experiences from the field. These stories are inspired by real cases in an effort to share the challenges and triumphs of real people navigating their way through estate planning and probate.
To kick off the series, we’re starting with the basics, a question we get time and time again from estate planning clients:
What’s the difference between a Will and a Trust?
Although both wills and trusts are estate planning documents that detail what happens to your assets–home, property, money–after your death, they both have different features, in addition to various advantages and disadvantages.
A will is an estate planning document that goes into effect after your death and dictates who will receive your property and assets. It is limited in the scope of what it can control; for example, a will can only cover property and assets that are in your name. A will also creates a public record and is subject to probate, court proceedings to validate and process the will.
A trust is an estate planning document that goes into effect as soon as it is signed. Trusts are private and allow for the transfer of property and assets while you are still living, which gives trusts a bit more flexibility than a will. Trusts allow for future planning and can still be in effect generations after the initial start of the trust. Property and assets placed in a trust do not initiate probate proceedings and can plan for events, restrictions, and requirements that go into effect or are sustained even after your death.
Because trusts create a separation between legal ownership and beneficial interest, there are different types of trusts to meet different needs. For example, a land trust is an entity that takes ownership and authority over property at the request of the owner and is only used for land/property. Other types of trusts, like living trusts and special needs trusts can be tailored to structure other directives for health care decisions, succession plans, and taking care of children or family members with special needs.
There are more types of trusts and smart, effective ways to utilize wills when thinking of a comprehensive approach to your estate planning. We’ll cover more about estate planning in our summer series, but you don’t have to wait.
You can contact us for guidance regarding tax-smart, empowering ways to begin your estate planning TODAY.
