Estate planning for single adults can be a little more complex when compared to a married couple. If you have minor children, you have to designate guardians for them. If you’re child-free, you have to think about whom to choose as your beneficiaries. The number of decisions involved may seem overwhelming, but when you have an experienced estate planning attorney on your side, you have a resource for information and assistance. Start your estate planning journey by deciding on the type of documentation you want— a will or a trust.
What is a Will?
A will is an essential document that specifies how your assets will be distributed after you pass away. Wills vary in length, efficacy, and complexity. In your will, you would typically name your beneficiaries and what they receive from your estate, as well as naming an executor of the will. If you are single with minor children, you would also appoint a legal guardian for them in your will.
What is a Trust?
A trusts is an estate planning tool that allows one or more persons (the Trustees) to hold and manage property for the beneficiaries of the trust. A living trust is most comparable to a will and is sometimes used to replace the traditional will.
A trust is more contractual than a will. Because of its nature, it requires more specific wording than a will; you have to make sure that you close every loophole and consider every eventuality. That’s where your estate planning attorney becomes your best friend, since he or she can advise you about wording and legalities. For a trust, you need a grantor, trustee, and at least one beneficiary. As a document, a trust is usually longer and more complex than a will.
Portability
Trusts are easier to transport across state lines, so if you move frequently, you may want to talk with your lawyer about the advisability of using a living trust instead of a will. Wills can sometimes transfer, but you would need to consult with a lawyer who knows the laws of the state to which you plan to move.
Conditions within a Trust
Imagine that you would like to include a particular friend or family member as a trust beneficiary, but you’re a little nervous about your choice because that individual is a substance abuser or uses poor judgment when handling money. You can use provide instructions in the trust to limit that beneficiaries access to the trust funds.
Probate Court and Moving Assets
A trust has another advantage over a will. Whereas a will almost always has to move through the probate process, you can set up the trust so that the assets contained in it bypass probate. However, keep in mind that any assets you have in your name at the time of your death will still have to go through probate court. You’ll need to regularly evaluate your assets and estate to decide what you want to transfer to your trust. You can also have your lawyer help you create a “pour-over” will that will move your assets that are outside the trust into the trust when you pass away.
Privacy Concerns
Wills are not private. Any documents and court proceedings related to them are entirely public. In some cases, this a good thing. However, when you want to keep your estate value and other information private, a living trust is the better way to go. Just make sure that you select an estate planning lawyer who is well-versed in creating living trusts; because if the trust is poorly drafted, it may have to go through the court anyway after your death.
Wills can be simpler and cheaper to create, but keep in mind that they often carry additional work for your executor and heirs. Like any estate plan, a revocable trust needs continual review and maintenance to ensure that it is funded and in good shape. It is hard to predict whether a will or a trust will be cheaper, easier, or quicker to administer, since every person’s case is different. Talk to your estate planning attorney in Maryland to get some advice about which option might work best for you.
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About Nicole K. White
After losing a close relative, Nicole witnessed the devastation, enormous expense and chaos caused by not having a simple estate plan. It is Nicole’s mission to educate parents, especially single parents, about protecting themselves, their families, minor children, and assets with comprehensive Estate Planning.
