An estate plan is an important part of adulthood. Whether you are single and living on your own, or you have a family, you want to be sure that your wishes are followed after your death. You also want any decisions you make for end of life care to be adhered to.
Living trusts and wills are both a part of comprehensive estate plans, but do different things. Here’s an explanation of each to help you decide if either, or both, need to be included in your Atlanta estate planning process.
What a Will Can Do
There are certain things that a will can do that a living trust cannot. When you construct a will, you can:
- Name guardians for your children upon your passing
- Name managers for children’s property
- Name an executor
- Determine and dictate how debts and taxes should be paid
A living trust is not meant to do any of these things, and therefore won’t.
What a Living Trust Can Do
On the flip side, there are things that you will need a living trust for. A will won’t handle these things, but a living trust can:
- Help avoid probate
- Offer protection from court challenges
- Avoid conservatorship
What Both Can Do
Both a living trust and a will allow you to name beneficiaries for property. You can also revise each document after it has been completed and made legal. Both will allow you to leave property to younger kids, but a will may have some restrictions.
Why You Need a Will
People debate over who needs a will and who doesn’t. In general, it is always better to have a will in place no matter your stage of life, because your death could happen unexpectedly. The longer you wait to construct a will, the more risk you are taking in ensuring that your final wishes are carried out.
Specifically, it is a good idea to have a will if you are married or have children. In most cases, your spouse would inherit your assets upon your death, but things happen. Your children would inherit what you leave behind after your spouse, but there are situations that could prevent that from happening.
Having a will allows you to name your children as heirs and does not leave anything up to interpretation. On the flip side, if you don’t want your children to inherit your assets, that would need to be in writing.
You will also want a will if you have any type of positive net worth. Your assets will need to be distributed in some way when you die and the decision of how should be yours. A judge will make those decisions for you if you do not.
People who are single, don’t have children and don’t have a positive net worth can stand to wait on a will. If there is nothing to distribute, you’ve got nothing to worry about. Your life circumstances may change later on that would indicate a will is a good idea.
Who Needs a Living Trust
There are good reasons to have a living trust included in your comprehensive estate plan. A living trust allows for the lifetime management of assets. If you have a family-owned business, a large net worth, or a number of assets, a living trust can help protect them both immediately after your death and for the lifetime of their transfer.
Some people choose to create a living trust because it is private. A will is public record, while a living trust is not. The way your assets are distributed remain confidential, something that is attractive to people. People who don’t have a net worth or only possess a small one may not need a living trust.
Another thing to consider is how you plan on dividing your assets among your children (if you have any). A will is fairly easy to contest. A living trust is not. If you plan on leaving more to one child than another for whatever you deem a fair reason, a living trust is probably a better way to go.
The child who doesn’t receive the greater piece cannot contest your wishes as easily when they are included in a living trust. An Atlanta estate planning attorney or financial advisor can help you determine what does need to be included in your estate plan based upon your unique situation and your desires upon your passing.
The Drawbacks of Each
Wills are fairly easy to establish, easier to modify, and involve very little maintenance. Living trusts, on the other hand, can be costly to have drawn up, need ongoing maintenance, and can be time-consuming to establish.
Many professionals will recommend that you create at least a simple will even if you have established a living trust. Because each person’s situation is so unique, it really does pay to speak with an attorney who can review your assets, talk to you about your wishes and then help you make the best decision.
Speak to an Atlanta Estate Planning Attorney Today
If you would like more information about estate planning in Atlanta, please reach out to our office at 678-242-8344. We can help you determine what type of protections you need based upon your current lifestyle and financial situation. There is no plan that is right for everyone, so let us help you create a personalized plan. Call today to schedule an appointment.