Earlier this week, I wrote about the times a person needs to have a Last Will and Testament. The Will is the most basic of estate planning documents. There are, however, times when need and/or personal preference dictate that the revocable trust plan is the better choice.
How do you know when you are experiencing one of those “times”? Consider some of these factors:
1. Primary goal is privacy.
As I wrote a couple of months ago, this factor is often underrated in estate planning. If a Will is probated, all records of the proceeding are publicly available.
2. Primary goal is avoiding probate.
A Will does not provide any means to avoid probate. If you pass away owning real property that is not jointly titled, your heirs will be going to probate. A Trust, however, exists and owns the real property the day it is transferred into the Trust. Since the Trust is the owner of the real property, the death of an individual does not impact this.
3. Planning for Mental Disability or Special Needs.
If you have children, grandchildren, or other dependents with special needs a Trust can be customized to meet these needs, by specifying and limiting access or control over inherited property. A Will allows you to pass on your property to those heirs but a Will in itself does not allow you to exercise substantial control over your heirs use of the property.
4. Have children who are not children of your spouse.
Children from previous relationships require special consideration because each likely has an absolute right to inherit from their parent but the current relationship may also call for distributing property differently. A Trust, more flexible than a Will, is a better vehicle to handle these considerations.
5. Own real property in more than one state.
If you have a summer home in Missouri, leaving that property in a Will probably means hiring an attorney in Missouri and paying attorney fees and costs to get the property transferred. A Trust allows you to hold and pass on the real estate to your loved ones without unnecessary travel and expense.
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