Preparing for one's death is never easy, especially if you are trying to plan what happens to your estate when you are gone. For those with spouses and dependents, you may wish to leave behind funds for them to be able to access as they mature, possibly ensuring that they have income or property in the future. As such, it is important to understand how wills and trusts work to determine which you need.
The Difference Between a Will and a Trust
Drafting a will or trust is the primary way someone can prepare their estate's future. However, each one offers different benefits for each person's unique needs.
A will is your wishes as to how your property and finances will be dispersed upon your departure. You can designate an estate administrator to ensure that your various requests are honored when you pass. A will can be used to:
Designate who will own your property
Name an estate administrator
Name guardians for minor children
A trust, by contrast, is more specific in structure. The Superior Court of California defines a trust as when one person (a trustee) holds the title to the property for the benefit of another person (the beneficiary). The trustee will administer and distribute the property listed in your trust after you have passed away. Essentially, your estate goes directly to another person instead of subjecting it to probate.
Which Do I Need?
It is generally always a good idea to make a will, even if you have a living trust. A will provides a backup plan for any assets that do not get included in your trust. If there is no will when you pass, any property that was not included in your trust will go to your closest relative. Additionally, a will is useful for individuals with smaller estates, and it may be the only thing you need to avoid estate litigation and make the probate process simpler.
On the other hand, since California has complex probate laws, a trust may be more appealing. A trust allows you to avoid probate and estate taxes, which makes it ideal for individuals with larger estates. However, it is more complicated to make than a will.
Contact a Pasadena Estate Planning Attorney
A Pasadena estate planning attorney can examine what your goals are and help you determine the best way to plan your estate. Our team can provide more knowledge on the matter after looking at your unique circumstances. At the Law Offices of Donald P. Schweitzer, we are prepared to make sure your final wishes are kept intact.
Call the Law Offices of Donald P. Schweitzer for your estate planning needs at (626) 788-5225.