It is commonly understood what the purpose of a Last Will and Testament does, especially if there are assets to leave to family or friends. A living trust can be equally valuable, although it often takes the help of law firms in Bryan Texas to grasp the purpose of such a document. Both have similar functions but each is used somewhat differently. When planning an estate, it is important to learn the difference between these two documents to see how a living trust can offer current protection, while a will protects beneficiaries later on.
Living Trust and Will – The Differences
Both a living trust and a will are legal documents that allow individuals to state how property or wealth will be handled after the death of that individual. One of the first perceivable differences between the two is that a living trust is not required to be probated through a court. Probate is the legal process of reading a will after that person is deceased, determining the worth of the deceased’s estate, and then dividing the estate as documented by the deceased. It is time-intensive and executors of a will can charge a fee for time and service that must be paid from the proceeds of the estate, which does reduce the value of the estate that can be awarded.
A living trust does not have to go through probate and the distribution of assets that have been designated by a valid will can be accomplished in a much shorter period of time. Without the cost of probate, the estate is usually larger than when processing through probate court. Any person who is considering having a living trust should learn the details of this type of estate planning to see if it appears to be the right thing to do. Law firms in Bryan TX can help by explaining all of this to someone looking at estate planning and advise if a living trust would be useful.
A Living Trust – The Benefits
As mentioned above, the chief advantage of a living trust is that estate owners can plan the distribution of estate assets ahead of time, which will reduce the time and effort required to do the same thing upon reading a last will alone. Legal fees are less, the whole estate dispersal process is quicker, and the person or persons drawing one up can more easily revise a living trust without having to create a new will.
Property ownership can be jointly divided between estate owner and benefactors so that ownership transfers more easily upon the death of the trust owner, making the entire inheritance process more easily handled. For those with a large estate, this can be very beneficial.
A Living Trust – The Difficulties
There are not many difficulties with a trust, perhaps the correct phrase is additional action that needs to be taken when putting one’s assets into a living trust. Assets that are currently in banks, stocks, bonds, and anything similar needs to be transferred by separate paperwork to the estate. Insurance policies, IRA’s, 401-k’s and the like must name the estate as the beneficiary rather than any individual person. All of this takes extra paperwork and time as well as the expertise of a law firm in Bryan that is familiar with this type of estate planning – which is why the initial cost to set up a living trust is so much greater than just writing a will.
A living trust can be a great option for individuals, couples, or families with large estates and offers the side benefit of allowing the designated representative or successor trustee to assume estate handling if the owner of the living trust should become incapacitated without the court intervention that would be required even with a durable power of attorney. Law firms in Bryan TX caution that consultation with qualified estate attorneys should be done before deciding if a living trust is the best estate path to pursue. If it is, a living trust may indeed be a great tool for estate planning purposes.