If I Have A Will As Part Of My Estate Planning Documents, Do I Still Need A Trust? Is One Better Than The Other? Are These Supporting Documents?
A Will and a Trust are complimentary documents. You can have a Will without a Trust, but you cannot have a Trust without a Will. In California, there are some people only have a Will because they have very few assets, all their assets have named beneficiaries and they have no children. If you have a will on its own, it’s called a stand-alone will, and it will have all the information about your Executor, beneficiaries, what they all receive and how they receive it. With a Will you may not need to go through Probate, but even if you do, the Probate court will have a record of your wishes to refer to when decisions are made about how to distribute your assets.
If you own property or have children, I always recommend having both a Will and a Revocable Living Trust. A Revocable Living Trust is a legal document that creates a place to hold your assets. You take an asset, like your home, and change the title of that asset from your name to the name of the trust. The nature of this trust allows you almost infinite flexibility with your assets while you are alive. It also creates rules for dealing with the same assets when you are incapacitated and additional rules when you die. A Trust is a way to manage your assets in a way that protects your money from creditors and sometimes taxes. By putting money into a trust, you keep yourself safe during your lifetime while also making things much easier for your loved ones when you are no longer able to make decisions.
Many of my clients wonder if they need a will if they have a trust. They do. If you have a trust, we will draft what is known as a pour-over will, which accounts for everything that is not named in the trust. In other words, the will pours all of your assets into your Trust and then the trust makes all the decisions.
When Ideally Is The Best Time For People To Start Setting Up Their Estate Plans? Is It Ever Too Late, Is It Ever Too Early?
I always say to my clients that the best time to start an Estate Plan is now. You probably needed it before you’re coming in to see me. I tell all my clients that when it comes to death, they’re not special, bad things can happen to them and they need to plan for those things while they still can. There’s a quote from John F. Kennedy, which says, “The time to repair the roof is when the sun is shining.” I have that quote on my business card because I believe you should come in and talk to an estate planner as soon as you have anything, or anyone, you want to protect.
Unfortunately, there are times when it’s too late to create an estate plan. Don’t want to wait until you don’t have the mental capacity to understand and sign legal documents. I’ve had people come in and ask for a will to be made for a parent who cannot understand what they are signing. I can’t make a will for someone unable to make their own decisions. I also can’t make a will for someone who is already deceased. So, do it now. This year has been a real eye-opener for people, and I’ve had many people come in who can’t believe they waited as long as they did. People think it’s harder than it is. It is a process, but you’ll have so much more than you expected in the end. Not only will you have documents, but you’ll have an organization for your assets.
For more information on Estate Planning In California, a free initial consultation is your next best step. Get the information and legal answers you are seeking by calling (415) 570-9809 today.
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