Many people ask us if they should get a will or a trust. That is a question that can’t be answered without knowing what the person wants to accomplish in their estate plan. The key component in anyone’s estate planning is not just cranking out documents, but more specifically about determining a person’s goals and how best to achieve them.
Will Based Plans
Simple wills are not designed to accomplish much. They are limited to (1) naming a guardian for minor children, (2) naming an executor to wrap up the estate after a person passes away, and (3) indicating one’s wishes for final distribution of property. That is it. If a person wants to do anything else, they have to create a trust inside the will called a testamentary trust that goes into effect upon the testator’s death, and has associated with it much higher fees. At that point, it is no longer a “simple” will. If cost is a concern, that singular “advantage” was just lost.
Revocable Living Trust Based Plans
Revocable living trusts are not as complicated or intimidating as many people think. They provide a different way of owning your property. As initial trustee of your trust, you have full access to all your assets in your trust. Instead of owning the assets as “Bill Sample,” individually, you own your assets as “Bill Sample, Trustee of the Bill Sample Living Trust.” For a revocable living trust to be effective, you must re-title all your assets (a process called “funding the trust”) into the trust or those assets will not be governed by your trust. However, if you take that extra step and fund your trust (which we will assist you in accomplishing), there are many protections that can be accomplished which are not available in a simple will.
There are many factors to determine whether one should seek a will or a trust, but it should be based on the goals a person has for their own plan. Meeting with us to discuss your specific situation is a must to properly craft an estate plan that is right for you. If you would like to attend one of our Truth About Estate Planning workshops or arrange for an initial consultation, we will provide much greater detail and answer all your specific questions. You may contact us at 703-490-0901 or email us at email@example.com.