When working out an estate plan, you may be wondering if you should use a will or trust to protect your assets. If you are new to estate planning, how do you know which to choose? Our estate attorneys can explain the difference between wills and trusts to help you figure out which you need.
Wills are the most commonly used and understood estate planning tools. These are documents which state how you want your estate handled after your death. In a will, you can name an estate executor, make your asset distribution wishes known, and even state where you want your funeral held.
Wills are more affordable to create than trusts. However, after you pass, the legal fees of probate court will cost your loved ones. The process is longer and has to pass through court before your beneficiaries can access the inheritance. What many people like about wills is that they are simpler to draft and cost-effective when it comes to drafting.
Trusts are another method to transfer assets in an estate to beneficiaries. A trust establishes a trustee, who handles the distribution of your assets. There are many different types of trusts, each which can serve various needs. A trust can provide for a special needs loved one, pass on a life insurance account, fund non-profit or charity organizations, and more.
Pros and Cons of Wills vs Trusts
Both wills and trusts are important documents to have in your estate plan. However, they each have their own benefits and drawbacks.
Some benefits wills have over trusts include:
- More affordability and cost effective
- Simpler to draft with less legal formality
- Easier to remember to update
- Generally requires less work to maintain
Some benefits trusts have over wills include:
- Assets can be distributed without probate
- Can reduce legal and probate fees for beneficiaries
- Beneficiaries can access inheritance faster
- Process does not need to be public knowledge
Let Us Help You Create a Will or Trust
The truth is that many estates have both a will and a trust. It is a matter of choosing one vehicle to transfer the majority of your wealth. At Murfree & Goodman, we can help you choose the right estate planning tools to use for your specific assets. Reach out to our firm today to learn more.