Many people write a will when creating their estate plan, but a will may not meet your needs or achieve all your goals. It is important to consider all your options when planning your estate, including trusts.
What are the advantages of a trust?
One important advantage of a trust is that the assets held by the trust do not go through the probate process. The probate process can be costly and time-consuming. It can also add stress to an already difficult time for your loved ones. By avoiding probate, you may be able to avoid these challenges.
Trusts can also help maintain your privacy. Because trusts do not go through the probate process, their details are not necessarily public knowledge. This allows you to maintain both your privacy and the privacy of your family.
Using a trust to build your estate plan can be especially important if you want to provide for a loved one with special needs. Many disabled people rely on government support to meet their daily needs, and inheriting a large sum of money could leave them unable to receive these payments. Because the assets you left them would be owned by the trust instead of your loved one, they could still receive the disability benefits they rely on while also having additional funds for recreation, school and other activities.
You can also set guidelines for receiving the funds you have placed in trust. For example, you might place money in trust to allow your children or grandchildren to attend college. While a will would give them these funds at the time of your death, you can instead specify that these funds are only to be given to them after their high school graduation.
Some estate planning strategies use both a will and trusts.
Just as it is important to explore all the estate planning options, you should also consider how these different documents can work together. As CNN notes, your estate plan can contain both a will and trusts, allowing you to gain the benefits of a trust while also establishing a plan for any property not held in trust.
By exploring your legal options, you can create an estate plan that gives you confidence and peace of mind today and meets the needs of your loved ones for years to come.