Wills vs Trusts, which is right for you?
If you want to ensure your assets will be distributed the way you want after your death, it’s important to plan your estate with an attorney here in Montgomery County or Prince George’s County Maryland.
There are a number of options available, as any good estate planning lawyer will tell you. Do you need a will or a trust? Is it possible that you don’t need either? I can tell you from experience that it’s very rare to find a person who doesn’t need to do any estate planning at all.
You may think that the distribution process would be simple and straightforward because you have a small estate. Unfortunately, that is not often the case. Instead, there’s a good likelihood that when you die, your estate will have to go through probate. This is a formal court process to take an accounting of your assets, settle any outstanding debts and close out your affairs.
After this is done, a judge will then distribute your remaining assets according to Maryland state law or your will, if you had one.
Of course, this is after the probate process has taken place, and plenty of court and attorney’s fees have been deducted. This could cost your family thousands of dollars and a ton of time stuck dealing with the courts.
The good news is that you can avoid this process all together by creating a comprehensive estate plan. Here are some things to keep in mind if you’re trying to determine the benefits of wills vs trusts.
When it comes to wills:
- They are often sufficient for those leaving behind less than $100,000 in assets.
- A will gives you the opportunity to leave something to a friend, non-registered domestic partner, or organization you support—whereas state law will only allow your assets to go to next of kin.
- A will also allows you to choose who will carry out your wishes by naming an executor.
- If you have dependent children, a will can give you the opportunity to name their guardians in the event of your death, instead of leaving that choice solely to the courts.
- However, you should know that a will doesn’t keep your estate out of probate, so those costs and the time involved will still apply.
- Finally, when your estate goes through probate to administer your will, all the matters becomes part of the public record.
Now that we’ve looked at wills, let’s discuss some of the benefits of having a trust:
- Trusts are a good idea for anyone who owns real property or has assets worth more than $100,000.
- Like a will, the trust can usually be revoked or modified while you are still living.
- Unlike a will, a trust can allow your beneficiaries to skip the probate process.
- Trusts are also a key part of disability planning and can help greatly if you become disabled or incapacitated during your life.
- And, trusts are held privately, which means your affairs will not be made public after your death.
This is just a brief overview of wills vs trusts, so it’s always best to meet with an attorney to ensure you are making the best decisions for your individual needs. A lawyer will have experience using wills and trusts to reduce estate taxes, create funds for surviving family members, and conduct charitable giving in a way you choose.
We’re happy to help you get started with the process, so please feel free to call (301) 968-1630 for more help. You can also visit us on the web at www.kinseylawgroup.com for more estate planning resources and tips.
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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.