Attorney
A will and a trust are both ways to protect your heirs and make sure that the people you want to inherit from you do so, but there are quite a few differences between wills and trusts. If you do not have either a valid will or trust when you die, you are intestate, and California law will decide who gets your assets after you die.
The only way to control what happens to your things after you pass on is to have a will or trust that meets our state’s requirements for validity. A California estate planning attorney can talk to you and help you decide which one is a better option for you in your situation.
What You Need to Know About Wills
A will is generally a more basic document than a living trust. Most wills cost less than trusts because trusts are often more sophisticated than wills. It is easier to set up a will than a trust because, once you sign the document, you are done. With a trust, you will have to retitle all of the property that will pass through the trust.
You will still need to update your will periodically. Some events automatically terminate a will by operation of law. You should update your will if you get married, become a parent, have another child, or get divorced. It is smart to review your will on a regular basis, like once a year, to see if you want or need to make changes.
Wills have to get approved by the court after the person who set up the will (the testator) dies. The estate has to go through the probate courts. That process can take a year or more, but it is better than not having a will or trust. The costs to probate an intestate estate (having no will or trust) are higher than probating a will.
An Overview of Trusts
There are many different kinds of trusts. You can tailor a trust to:
- Provide for a disabled child without jeopardizing his eligibility for public assistance programs.
- Qualify for Medicaid to pay nursing home costs without leaving your spouse destitute.
- Distribute assets over many years. For example, some people have a trust pay out part of a child’s inheritance when he graduates from college, another portion when he turns 25 years old, and the remainder when he is thirty.
- Provide protected income with supervised distributions for a loved one who struggles with issues like addiction or poor money management.
- Save on taxes
These are but a few examples of the many things you can accomplish with a trust that you cannot do with a will.
After you sign the trust document, you have to transfer all the assets that will pass through the trust into the name of the trust. While you are alive, you will likely be the trustee of the trust, but you can designate someone to serve in that capacity
You will need to name someone to serve as the trustee after your death. It is best to name a trustee and at least one successor trustee, in case the first person you choose is unable or unwilling to serve in that role. The trustee can be an individual, like a friend or relative, or a professional, like an attorney, accountant, or professional trustee.
A California estate planning attorney can draft the documents you need to accomplish your goals. Contact us today.