Is a Will or a Trust the Cornerstone of Effective Estate Planning For You?
Creating a robust estate plan is essential for ensuring your assets are managed and distributed according to your wishes. Most often, trusts are preferred to best manage assets and avoid probate. A simple will may be needed in the case of minor children who would need a guardian in case both parents pass away or become unable to care for the child(ren). Trusts, however, offer enhanced flexibility and control, enabling you to bypass the probate process, protect your assets, and potentially reduce tax liabilities. Our experienced estate planning attorney can help you determine what trusts might best meet your needs and whether a simple will is necessary.
How Are Wills Created?
In Massachusetts, drafting a will requires the testator (person making the will) to be at least 18 years old and of sound mind, meaning they understand the nature of their assets and the implications of their decisions. A valid will must be signed by the testator and witnessed by two individuals, neither of whom is a beneficiary of the will. Should our skilled estate planning attorney determine that a simple will would benefit your estate plan, we can help you draft a will that meets your needs.
How Are Trusts Created?
Creating a trust involves drafting a trust document, naming a trustee who will manage the trust’s affairs, and transferring assets into the trust. Many varieties of trusts can be created to serve specific purposes, so it’s important to carefully examine your objectives and options to determine the most effective trust for you. As the process for setting up a trust is complex, it’s critical to enlist the assistance of an experienced trusts lawyer who can help ensure your trust is legally enforceable and meets your planning goals.
How Do Trusts and Wills Affect the Probate Process for Your Estate?
Avoiding probate can save time and money for your beneficiaries. Trusts are a popular tool for bypassing probate, as assets held in a trust don’t become part of the probate estate. By setting up a trust, you can allow a more immediate transfer of assets to beneficiaries after your passing and help maintain privacy around your estate’s affairs. While probate proceedings are a matter of public record, the terms of a trust don’t need to be disclosed publicly.
Assets that are solely owned by the deceased and not designated to transfer automatically, such as through joint ownership or beneficiary designations, are subject to probate if only a simple will is in place. Probate is a legal court process through which the estate’s assets are identified, debts are paid, and the remaining assets are distributed to beneficiaries. When a legally enforceable will exists, the probate court will validate it and authorize the executor to carry out the actions specified in the will. If there’s no valid will or trust, the court must distribute assets according to the state’s intestate succession laws, which may not align with your preferences.
In Massachusetts, probate can be a long and expensive process, often taking a year or more to complete for more complicated estates. The state has adopted the Uniform Probate Code, which streamlines the proceedings but still involves court supervision and requires significant effort from the executor. During probate, the estate’s assets are unavailable to the beneficiaries, which may lead to financial difficulties for dependent family members.
Therefore, a trust or trusts may be your best estate planning tool. Please reach out to us for assistance in determining what route is best for you and your loved ones.
Why a Trust is an Important Component of a Strong Estate Plan?
While a will allows you to detail how your assets should be apportioned after death, name guardians for minor children, and appoint executors to manage your estate, having only a simple will would require a lengthy and complicated probate process that will cost the estate money. By integrating trusts into your customized Massachusetts estate plan, you can address both immediate and long-term needs, ensuring that your legacy is preserved and your beneficiaries are cared for according to your wishes.
Trusts can offer greater flexibility and control over asset distribution. Trusts enable you to fine-tune your instructions and set specific conditions on how and when beneficiaries receive their inheritance, such as assigning age milestones or earmarking funds for educational purposes, which can help protect assets from being mismanaged. Additionally, trusts can protect beneficiaries with special needs or those who might be financially irresponsible, ensuring their inheritance is managed prudently. Certain types of trusts, like irrevocable trusts, can also help reduce estate taxes, allowing more of your assets to be passed on to heirs.
One type of will commonly used with a trust is a “pour-over will.” This isn’t the same thing as a simple will. A pour-over will functions in conjunction with a living trust to ensure that any assets not already included in the trust are immediately transferred to it upon the individual’s death. A pour-over will is designed to “catch” any assets not transferred into a living trust during your lifetime, including assets that were accidentally left out of the trust. Upon your passing, these assets are directed to the trust after they go through probate, making certain they are distributed according to the trust’s terms.
Reach Out to Our Experienced Massachusetts Estate Planning Attorney
Estate planning can be a complex but essential task. Due to the discomfort many people feel when considering their own mortality, they delay their estate planning process or engage in it once and neglect to update their plan to reflect the changes in their lives and state laws. However, a complete and up-to-date estate plan is one of the best gifts you can give your loved ones. By exploring wills, trusts, and other applicable planning tools, you can build a solid strategy that simplifies the asset distribution process and safeguards the futures of your beneficiaries.
The Heritage Law Center can assist you with all aspects of the estate planning process. Our compassionate, skilled attorney will take the time to understand your financial situation and desired outcomes so they can craft a customized plan to meet your needs. Creating a solid client-attorney relationship is vital to the Heritage Law Center’s mission because your estate plan should continually evolve to serve your current situation and protect what’s most important to you. To learn more about our services and how we can assist you, contact our office today at 617-765-9307.
