What is a will?
A will is essentially a document where you are leaving a series of directives for when you pass away. Through this document, you are expressing that at the time of your death, you would like a specific group of people known as your beneficiaries to receive your possessions or assets in a particular sort of way and who the guardian of your young children should be.
A will goes into effect when you perish. Until that time, it’s merely a document stored in a file. A will must be revised and updated every five years or sooner if there have been any significant developments such as divorce, marriage, a new home, or a new child.
A will does not circumvent probate court – although a good will can make the experience straightforward. It will not include either legal or medical powers of attorney, which grant an agent to make decisions on behalf of you if you are incapacitated. Furthermore, A will is a public document. It will not keep your matters private. for this reason, people occasionally decide to get a trust instead of a will.
What is a trust?
A living trust, more commonly known as a trust, is a legal entity created to control your assets. To create a trust, you must initially set it up, transfer all of your assets – such as your accounts, your property, your house, your car – into the trust and title them in the name of the trust.
The distinction between a will and a trust is that a will only becomes effective upon your passing while a trust is created while you are still living. You sustain control over the trust and all of the assets until you pass away.
An additional distinction between a trust and a will is the differences in their cost and when these expenses transpire. At least in the short term, a trust is typically significantly more costly than a will.
However, one evident advantage of a trust is that it incorporates the legal power of attorney. Nearly all trusts are crafted in a way so that the control shifts upon death or if an individual is incapacitated, rendering an unrelated power of attorney nonessential.
A trust can help you circumvent the probate process. It incorporates the legal power of attorney, and you can pay for your costs immediately with no expenses later. A trust keeps your matters private and is not public knowledge and, most importantly, ensures that your assets are transferred precisely how you want them to be, and you decide who has power over them.
For individuals with young children, a trust can be created within a will that designates an adult to oversee the inheritance of the children until the time that they are grown and mature enough to take charge of it.