When creating their estate plan, many individuals believe that a will is sufficient to ensure their wishes are carried out after their passing. However, this is a common misconception in estate planning.
While a will is an essential component of an estate plan, it is often not enough on its own. A comprehensive estate plan typically includes other important documents, including trusts.
If you have doubts whether to include a trust in your estate plan due to worries that it clashes with your will, below are some considerations you should know.
Trusts do not go through probate
Wills must go through probate, which can be a lengthy and costly process. Assets in trusts, however, can bypass the probate process, allowing for an expedited and less expensive transfer of assets. This is because when you create a trust, you are creating a separate legal entity to hold your assets for your beneficiaries.
Trusts remain private
One of the appealing features of trusts is that they generally remain private. Unlike wills, which become part of the public record once their personal representatives submit them for probate, the terms of a trust and the details of the assets within them are typically not available to public.
Trusts allow you to manage assets even before death
Wills take effect only after your passing, whereas trusts allow you to manage and distribute assets during your lifetime and following your death. Hence, trusts can be an effective way to manage and protect your assets both during your lifetime and after your death.
Making your decision
It is important to note that while trusts can provide significant advantages, they are not a one-size-fits-all solution and you should consider it as part of a comprehensive estate plan. Trusts require careful drafting to ensure their structure aligns with your overall estate planning goals. Speaking to a lawyer who specializes in estate planning can give you clarity on whether a trust is right for your situation.