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Nolan Elder Law and Estate Planning, LLC Blog

Saturday, March 11, 2017

I Have A Will...Do I Need A Trust?

After spending your whole life working, it makes sense that you would want to take all the steps necessary in order to ensure you still have some control over what happens to your assets when you pass away.

Regardless of your situation, it is important to collaborate with an estate-planning lawyer to make sure your affairs are settled. Having a will drafted is an important step to take as you decide how you would like your assets and property to be divided upon death. It may not be the last step though.

What Are The Downsides Of A Will?

Most people are familiar with the concept of a will, and the actual drafting of the paperwork is usually not terribly expensive, depending on the extent of your estate. However, wills are only effective once they are admitted to probate. Probate is the period where a will is officially ‘proved’, and can sometimes lead to costly and time-consuming litigation.

Things can get even more complicated if there is a dispute over your assets among family members.

What Does A Trust Have To Offer?

A will goes into effect after your death, which means you are not able to control what your beneficiaries will do with your assets. A trust gives you this power and can be particularly useful if you have, for example, extensive property in the family. A trust gives you the power to control both the timing and condition of how your assets are dispersed.

You have the power to appoint a successor trustee to manage your affairs if you pass away or become disabled. The successor trustee is obligated to follow your instructions. Some trusts can also be revocable, which gives you the power to amend the document or take away assets.

Alabama law does allow for a trust to be the beneficiary of an insurance policy. Some of the laws concerning trusts in Alabama are different than other states, and an estate planning or estate administration lawyer will be able to guide you through the process of setting up a trust.

Trusts also offer the following benefits:

1. Avoiding probate: A trust is not subject to probate, which can be costly. Even though you might have to pay whomever the trustee is for the life of the trust, this is usually less than the cost of probating an estate.

2. Protection in case of incapacity: The successor trustee is able to operate in the same capacity of a power of attorney if necessary. Some trusts also provide protection against creditors, but this varies on the type of trust. Working with an estate-planning attorney will give you insight into the various protections a trust will offer you in your situation.

3. Protection for small businesses: Probate can wreak havoc on the operation of a business, especially if a court has to supervise daily decisions. Usually, a trust would allow for your beneficiaries to seamlessly take over business operations and keep it running.

If you have questions about estate planning, contact us today for a consultation. Our experienced estate planning lawyers will walk you through all of your options.

 


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