Despite how most estate plans utilize wills and trusts, there are a surprising amount of misconceptions about each tool. Some would say that you only need one or the other, whereas others might say that wills are inherently worse than trusts. Often, the claim that wills are worse is in regard to probate. Most know that probate is a long process where your family and friends go through the court to receive their inheritance or assets left. If you are working on your estate plan, it is normal to feel overwhelmed. Here is what you need to know about wills and trusts before you decide.
The Probate Process
Probate tends to be the one thing that wills have to their disadvantage. Probate causes costs and delays in the process. However, this is not always the case. In fact, in some circumstances, it can be short and not at all expensive. A lot of states have codes in place to streamline the process and to make it less expensive.
Probate, likewise, is not a private process. If you do not want your information public, then you may want to avoid probate or wills. What makes wills helpful is that they are less expensive than trusts. They can also be more simple to form.
The Trust Dilemma
Should you have a trust instead? The truth is that most people use both vehicles to transfer assets. It may seem like trusts would be a better option because of the avoidance of probate, but this isn’t necessarily the case. Trusts are more expensive to form upfront. While you do not have to worry about the courts involvement, you do have to consider the upfront costs.
Additionally, trusts are more complex. A lot of people don’t realize that you have to transfer the legal title of your property into the trust. When you forget this step, then the trust has no value at all. You have to make sure that your trust is valid and has value before you finish your estate plan. In addition, you do need to update your trust regularly, in the same way that you would your will.
Your estate plan is important. If you make a mistake in your will or in drafting your trust, it could result in all of it being invalid. Wills and trusts are both useful vehicles for people to use to manage their estate after they die. To ensure that your estate plan is valid, consult with an estate lawyer in Allentown, PA today to find out if a will or trust is best for you.
Thanks to Klenk Law for their insight into estate planning and choosing between a will and a trust.