Estate planning refers to a collection of related documents and tools that place you in control of your finances. By utilizing tools such as trusts, wills, and powers of attorney, estate planning can provide many benefits to you and your family.
The process of estate planning involves anticipating and arranging financial plans, in the case of death, to ensure appropriate protection for the beneficiaries. This includes the management of minimizing gift, estate, generation skipping transfer, and income taxes.
An estate plan provides peace of mind for both you and your family members by ensuring that your estate is managed according to your values and priorities. You can have a designated trustee who can distribute and managing your assets if you die or become disabled per your wishes.
Having an estate plan gives you the power to minimize the probate process, expenses, delays, and loss of privacy, which would follow otherwise.
TRUST OR WILL? PROTECT YOUR ASSETS WTH A FLAT FEE-BASED TRUST PACKAGE.
The Difference Between Wills and Estate Plans:
A will is a legally binding document that contains information about the distribution of assets after your death. In addition, a will allows you to appoint legal guardians to look after relatives who may need assistance due to old age or infirmity. An up-to-date will ensures that your assets will be distributed according to your wishes and that your loved ones will not face financial hardships after your death.
An estate plan, on the other hand, is a more broad term. Estate planning is the process of arranging the distribution of assets in a way that results in maximum benefits to the beneficiaries.
Every adult should have an estate plan that includes a legal will. If a person dies without having prepared one, they are considered “intestate,” which means that the intestacy laws in the state where they died will dictate how their real and personal property are distributed and to whom.
If I Have A Trust Do I Need A Will?
Although wills there are some similarities between trusts and, they serve different purposes and meet different needs. One significant difference is timing.
The most common type of trust, the “living trust” allows you to manage assets and make distributions during your life and directs how those assets will be distributed upon death.
A will, on the other hand, only becomes effective after death. A trust can also minimize estate taxes and avoid probate, while a will alone must go through the probate process.
One effective strategy for estate planning is to combine a revocable trust with a “pour over” will. This method captures all assets in an estate, even those not included in the trust. Typically, this allows beneficiaries to avoid probate and gain immediate access to the property in the trust.