When it comes to getting your estate in order, you may think you can wait until you qualify as a senior citizen. However, ensuring you take care of your assets now saves you stress and anxiety in the long run. If you’re unsure how to differentiate between a will and a trust or how to begin planning your estate, a Washtenaw County estate planning attorney can help you navigate preparing and executing these documents.
A Will and a Trust: Explore the Similarities and Differences
Many people use the terms will and trust interchangeably, despite the significant differences between the two.
For example, a will is one of the most essential documents that a person will create. It details what they would like to happen to their estate, assets, and children after they pass. Your will is only actionable following your death. Failure to complete this document means that the state will take ownership of your estate and can distribute your assets to legal beneficiaries. This can go against your wishes, so ensuring you take the time to create a will is essential.
A trust, on the other hand, is an arrangement that details how assets are transferred, distributed, and managed by another party. Generally, a granter will transfer ownership of money to a trustee. The trustee is responsible for managing the money and providing it to beneficiaries based on the guidelines set in place by the granter. A trust can be determined while the person is still alive, taking effect once the assets are transferred.
How Do I Know Which I Need?
Generally speaking, it is recommended that anyone with assets creates a will. Not only will this determine how your estate will be distributed, but you can also detail who will assume legal guardianship of your children and pets. It also grants you full control over who you would like to receive assets. As previously mentioned, failure to complete a will before death gives the state the ability to distribute your will, meaning your money can end up with estranged relatives.
A trust is not as necessary as a will but can help ensure that your loved ones are comfortable and receive sentimental items if you so choose. One of the benefits of setting up a trust is that it creates a simple and legally effective means of managing your assets if you become ill or incapacitated.
However, there are several options to consider when setting up a trust. From irrevocable trusts to living trusts, you’ll need to consider the pros and cons of each option to determine which is best for your needs.
Do I Really Need a Lawyer to Create a Will or a Trust?
While creating a will or trust may seem as easy as writing down the details of each, you’ll want to ensure you enlist the help of a lawyer. Doing so ensures that your will or trust is legally valid, offering peace of mind that your wishes will be granted as you intend.
Contacting our firm can help ensure you have a seasoned legal professional to guide you through the process of drafting your will or trust.