Whether you have an estate plan or not, you probably know that a last will and testament can help you distribute assets to friends, family and loved ones if you pass away. But do you know what a living will can help you do? What about a living trust? Understanding these different elements is essential if you want to build an estate plan that safeguards your legacy—which is why we're covering the ins and outs of wills and trusts in this blog.
At Rech Law, P.C., we'll work with you to develop a detailed, comprehensive estate plan using documents such as a will and a trust.
To schedule a consultation with our team and start building your ideal estate plan today, contact us online or via phone at (704) 659-0007.
Why Should I Have a Will?
You probably already know that you can use a last will and testament to distribute your estate amongst family, friends, and loved ones when you pass away.
However, you can also use a living will to:
- Establish Health Care Power of Attorney (POA). Health Care POA determines what medical care you receive (and how is in charge of administering it) if you become medically incapacitated.
- Establish Financial POA. Financial POA determines how your estate is handled if you become medically incapacitated.
- Establish guardianship for any children you have. You can use your will to recommend a guardian for your children if you become incapacitated or pass away. The court will prioritize that recommendation when administrating your will (although it is not obligated to appoint the guardian you desire in your will).
As soon as you become financially independent, you should write both a living will and last will and testament. An estate planning lawyer can help you compile both documents and ensure you take the proper steps to make them legally binding (such as signing them in front of witnesses).
Why Should I Have a Trust?
Like a will, a trust allows you to allocate assets to friends, family, and loved ones when you pass on. Many people see this and assume that a trust is effectively useless if you have a will, but that couldn't be further from the truth.
When an individual dies, their estate goes into probate. During probate, a court works with an executor (usually an individual appointed by the deceased in their will to administrate their estate). The court and executor collaborate to validate the integrity of the will, pay off any creditors the deceased owed money to, and ensure the terms of the will are carried out and the deceased individual's last wishes are fulfilled.
Probate can be a long, expensive process that ultimately gets in the way of a deceased person's loved ones having the time they deserve to grieve.
However, trusts circumvent the probate process. In other words, assets you award through a trust don't have to go through probate. That makes a trust the perfect tool for distributing elements of your estate that may get caught up in the probate process, such as real estate or an intangible asset like a life insurance policy.
Why Do I Need Both a Will & a Trust?
Using a living will, last will and testament, and trust to form your estate plan gives you the best of both worlds. You can use the will to establish important legal precedents, such as POA and guardianship, while using the trust to ensure your estate is distributed without forcing your loved ones to endure a long, frustrating probate.
At Rech Law, P.C., we'll help you develop an ideal will and trust for your estate. Contact us online or via phone at (704) 659-0007 to schedule a consultation with our team.