Trust & Will
Establish a legacy and provide for your family.
Introduction
It’s a sad fact of life that… well… it comes to an end. However, all your hard work and the fruits of your labor don’t need to end after you pass away. Wills and trusts are useful legal tools that can protect your money and assets as well as outline how they should be used and distributed and are core components of estate planning.
A will is a legal document that lays out your final wishes: what kind of funeral you want, what to do with your assets, and any other requests and instructions for after your death.
A trust is an arrangement that grants someone (a trustee) the right to hold, use, and manage specific assets for a specific purpose. Trusts can be created while the grantor is still alive.
While both tools are important, everyone adult should have a will. If you don’t have a will when you pass away, your assets will be distributed based on state law, which may not match your wishes.
Key Takeaways
- Wills and trusts are estate planning tools to help you plan your legacy after you pass away.
- A will outlines your last wishes and comes into effect after you die. This includes funeral arrangements, distribution of financial holdings and property, and other factors.
- A trust is a document that establishes a relationship between a trustee and the grantor’s assets or property and specifies their use or conditions — like setting up a college savings account for a grandchild.
- Wills are important to have regardless of age. If you die without a will, your assets are handled and distributed based on state law.
Differences between a trust and a will
A trust and a will are two different legal instruments used in estate planning, each serving specific purposes and offering unique benefits. The following is an overview of some key differences between the two:
| Trust | Will | |
|---|---|---|
| Purpose | A trust is a legal arrangement that allows a person, called the grantor or settlor, to transfer assets to a trustee who manages those assets for the benefit of one or more beneficiaries. Trusts can be used to control how assets are distributed, minimize taxes, and protect assets from creditors or lawsuits. | A will is a legal document that outlines how a person’s assets should be distributed upon their death. It also allows the person to name an executor to manage the estate, appoint guardians for minor children, and provide specific instructions for the distribution of personal property. |
| Timing & Control | A trust can be created and go into effect during the grantor’s lifetime (living trust) or after their death (testamentary trust). The grantor can specify the terms of the trust, such as when and how the assets are distributed to the beneficiaries. | A will only goes into effect upon the death of the person who created it. Until that time, the person can amend or revoke the will, but they have no control over the distribution of assets after their death. |
| Probate | Assets held in a trust are not subject to the probate process, which is the court-supervised process of administering and distributing a deceased person’s estate. This allows for a quicker and more private distribution of assets to the beneficiaries. | A will must go through the probate process, which can be time-consuming, expensive, and public. The probate process ensures the validity of the will and oversees the distribution of assets as outlined in the will. |
| Privacy | Trusts are generally private documents, meaning that the details of the trust and the distribution of assets are not available to the public. | Wills become public record when they are submitted for probate, allowing anyone to access the information contained within the document. |
| Asset Protection | Trusts, particularly irrevocable trusts, can offer a higher level of asset protection against creditors and lawsuits compared to wills. Assets held in an irrevocable trust are no longer considered the grantor’s property, shielding them from potential claims. | A will does not provide the same level of asset protection as a trust. Assets transferred through a will are still considered part of the deceased person’s estate and may be subject to claims from creditors or lawsuits. |
Benefits of Estate Planning
Whether you have a family with children and grandchildren or are just establishing your professional life with no dependents, there are plenty of good reasons to consider trust and will planning. Instead of descendents, you can name close friends or causes you care about as beneficiaries, giving those you love gifts and financial stability.
Asset Distribution
BETTER CONTROL
Trust and will planning allows you to have control over the distribution of your assets after your death. You can specify how your assets should be distributed, to whom, and when.
Protection of Beneficiaries
PLAN AHEAD
A trust can protect the assets for minor beneficiaries until they reach a certain age or maturity level. This can prevent beneficiaries from receiving a large inheritance at a young age, which may not be in their best interest.
Preserve Wealth
SECURE YOUR FAMILY’S FUTURE
Properly structured trusts and wills can help minimize estate taxes by taking advantage of tax-saving strategies. Trusts can also ensure your assets are protected from potential creditors or lawsuits.
Avoid Probate
ENSURE YOUR PRIVACY
Probate can be time-consuming, expensive, and public. Trusts can help avoid the probate process, allowing you to distribute your assets privately and efficiently without going through probate.
Flexibility and Customization
TAILORED TO YOUR WISHES
You can create trusts and wills that reflect your unique circumstances, family dynamics, and intentions, allowing you to create a customized estate plan that aligns with your values and priorities.
Peace of Mind
NO UNCERTAINTY, NO WORRIES
Knowing that you have a well-thought-out estate plan in place can provide comfort and assurance to you and your loved ones, ensuring that your wishes are carried out and your legacy is preserved.
Schedule Your
Free Strategy Session.
During this call we will quickly discover where your financial opportunities are, where you want to go, and whether our expertise and strategies can help you get there. We can often determine if we are able to help in as few as 5 minutes.
