Every adult, wealthy or not, should have a valid will or a living trust in place. Yet, more than half of Americans are unprepared for the inevitable. A last will and testament is a legal document that outlines where and whom your property will pass to after death. Another option is a living trust. A trust also says how you want your assets distributed, but also helps distribute your assets faster, avoids probate, may help avoid unnecessary taxes and keeps your wishes private.
No matter the value of your estate, it’s essential to plan what will happen to your assets after death. While many avoid the subject matter, it’s the best way to take care of your loved ones financially (and save them the stress of end-of-life planning) after you’re gone.
Because these are the most important documents you’ll ever draft, it’s important to prepare yourself. In today’s blog, we’ll be taking look at why you should hire a lawyer to prepare your living trust.
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A living trust, also called a revocable living trust, is a document where you (the grantor or creator) transfers the ownership of property to a trust, which is managed by you as trustee for the benefit of a beneficiary (successor trustee).
Put simply, a living trust establishes:
One of the key differences to remember between a will and a trust is that a trust provides planning for incapacity. Whereas, provisions in a will only go into effect upon a person’s death.
A single drafting mistake could invalidate the trust or lead to disastrous results. There are various DIY platforms and templates, but they really aren’t advised. Most of these products are unlikely to meet your needs. You wouldn’t want to run the risk of property falling into the wrong hands or l the trust being ambiguous and requiring a court’s interpretation just to save a dollar.
You’ll also need to answer questions like:
If your estate plan includes children from a previous marriage, disinheritances, high-dollar life insurance policies or beneficiaries with special needs, we definitely recommend steering clear from DIY solutions. Whether your estate plan is simple or complex, an experienced attorney from a reputable law firm can provide you with advice and guidance that a DIY form or program cannot provide.
Do I need a Trust or Will?
State laws can be very particular on what may or may not be included in a living trust. Location may affect who may serve as personal representative; be a witness, where and how they need to sign the living trust. This may also change particular estate planning rules and procedures.
DIY solutions don’t support common complexities you find in living trusts like children, property that has depreciated in value or a large estate that may be subject to estate taxes. With software and templates, if you make an error, the whole trust can become invalid. Additionally, these options don’t always update according to new changes in estate planning laws.
Various circumstances can affect how you’ll draft your will and living trust. As mentioned, any mistakes can cause additional complications, expenses or make it invalid altogether. Some of these scenarios include:
We’re going to be honest, you’re not a lawyer and that’s okay. You likely don’t know which questions to ask or what your biggest problem areas might be. An attorney will also document your intent and state of mind, which is important if a dispute arises after death. An attorney will also listen to your goals and concerns and provide counsel based on your specific situation.
If you’re interested in drafting a living trust, guarantee its validity with the help of an attorney. Although educating yourself is wise, you’re hardly expected to be an expert in the matter. Attempting to manage your own estate plan without legal representation can leave you in the dark if complexities arise.
Plus, you’ll enjoy peace of mind knowing you’ll have ongoing support throughout the process.
If you’re ready to craft a living trust, our team can help. For more information, reach out to us today at (405) 701-6376.
In this simple 10-step guide, we walk you through an overview of the process so you can begin outlining yours today.