Estate Planning contains multitudes. Estate Planning, for the uninitiated, is the process of working with an attorney to create a legally-binding plan for what will happen to your belongings and property (known as your estate) and your remaining money (known as your assets) after you pass away. As for how you actually accomplish those goals - there are all kinds of options.
In Estate Planning, there are two main avenues of getting things done: Will-Based Planning and Trust-Based Planning. They aren’t mutually exclusive, but they each have their unique practices, pros, and cons. Which is best for you? It all depends on what you are looking for.
Will-Based Planning
Wills are the foundation of most Estate Planning. They allow you to specify exactly what you want to happen to your estate and assets, when it should happen, and who should help get it done. If you don’t make those decisions yourself, they are made by a state Judge in probate court - not by your family and loved ones.
Pros:
Wills are the most common form of Estate Planning for a good reason. They are the least expensive and the least time consuming to create of any form of Estate Planning. They are also fairly easy to update as needed. You can make them as simple or as complicated as you want, and include as many people as you see fit.
Cons:
Your estate will still enter probate court. Once in probate, your Will will be read and then distributed according to your wishes. It just means that there will be some buffer time (and some expense) relating to distributing your estate and assets to your loved ones. The requirements for Wills (and probate) are also different in every state, so you need to update anytime you move.
Trust-Based Planning
Trusts are a unique form of Estate Planning that allow you to put assets into something similar to a savings account. The Trust is run by a third-party, funded by you, and then given to your chosen recipient at the time of your death. Trusts can be given to spouses, children, businesses, charities, or any number of other organizations.
Pros:
The assets in a Trust are given directly to your chosen recipients when you die, instead of entering probate. That means that they get them immediately and directly. You can also fund those assets over your entire life, rather than just taking what is left when you die, like Will-Based Planning. Trusts can also cover a wide variety of purposes and contain a wide variety of things. They can even help you pay less in taxes each year.
Cons:
Trusts are more expensive and time-consuming to create than Wills. Some Trusts cannot be altered after they are created, meaning you couldn’t change who they were being given to or access the assets you placed into them. Trusts also cannot cover life-related areas like naming a guardian for your children or planning for your own elderly healthcare, which Wills can.
How To Get Started
No matter how you accomplish your Estate Planning, you’ll be better off for having gotten it done. To get started on your Estate Planning journey, contact Miller Law Firm PC today! We help our clients protect their loved ones and their own legacies by planning for the future in a number of different ways.
