Many people assume that creating a will is sufficient for their estate planning. Unfortunately, this is simply not the case. There are many key issues that a last will and testament is not going to help you to plan for. A will won’t help you to plan for incapacity, to protect your assets from irresponsible heirs, or to control what happens to wealth that you leave to a minor or to a disabled relative. These are just a few of the many different situations in which the creation of a last will and testament is likely not going to be sufficient.
When you make a last will and testament, you may assume that your wishes as expressed in the will are going to be respected. However, this is not necessarily the case. If your last will and testament leaves all of your property to someone other than your spouse, your spouse may be able to claim a spousal elective share. If you don’t want your spouse to be able to claim a good portion of your assets — even when your will specifies someone else should inherit — you’ll need to work with an experienced attorney to find alternative methods of transferring your wealth.
It is a common misconception that you should only create a trust if you are rich. This is not necessarily the case. There are many reasons why you might wish to create a trust, and trusts are definitely not only for wealthy people. In fact, it could be even more important to you to create a trust if you are middle class and your ability to leave a legacy could be put at risk by high nursing home care costs.
Trusts can be created to provide more privacy in the transfer of assets after death, to protect assets from being lost during your lifetime or after you pass on, and to facilitate the timely transfer of trust assets to heirs or beneficiaries who may be counting on an inheritance in order to maintain their quality of life. You should work with Parman & Easterday to determine if a trust should be part of your plans to accomplish your goals for your legacy and for the protection of your loved ones.
If you have been named as the beneficiary of a trust, it is important for you to know what to expect. The exact impact of inheriting through a trust, as opposed to being left assets in a last will and testament, is going to vary depending upon the type of trust that was created and the instructions in the trust document. You may simply inherit more quickly because the assets left for you will pass through the trust administration process. However, your loved one may have also created a special needs trust or other type of trust that imposes conditions or restrictions on your inheritance. If this is the case, you will need to understand what the limitations are and what exactly you must do to access your inheritance.
If you transfer your assets to your loved ones using a last will and testament, your wealth will need to transfer through the probate process. Unfortunately, the probate process is a time-consuming process that can be costly. The trust administration process is often better because it is cheaper, there is a reduced risk of your wishes being successfully contested, it is more private, and your family can inherit more quickly. These are just some of the many reasons why trust administration may be preferable to the probate process. Parman & Easterday can explain what the specific benefits of trust creation are based on your assets and family situation.
If you make the wrong trust type, you likely will not get the protections that you expected to receive when you created the trust. For example, a living trust will not provide your assets with protection from estate tax. You don’t want to create the wrong type of trust, only for you or your family to discover later that you didn’t actually protect your family or assets and that you are now at risk of loss. This can be prevented by working with an experienced attorney at Parman & Easterday who will discuss your goals for trust creation and help you to select the right type of trust for your situation.
If you are interested in creating or modifying an estate plan, you should talk with an experienced wills and trusts lawyer at Parman & Easterday. Our legal team will work closely with you to select the best combination of legal tools to achieve your goals for protecting your family and assets and securing your legacy.
To find out more about how our firm can help you with all of the legal issues related to wills and trusts, give us a call today at (405) 843-6100 or (913) 385-9400 or contact us online today. You can also join us for a free seminar to find out more about how a last will and testament and various types of trusts could become part of your comprehensive estate plan.