Creating an estate plan is one of the most important steps you can take to protect your loved ones and ensure your wishes are honored. At its core, an estate plan is more than just legal documents—it’s a way to provide peace of mind for you and your family, knowing that your affairs will be handled according to your desires.
Two Key Reasons To Create an Estate Plan
There are many reasons to create an estate plan, including honoring your wishes and protecting your loved ones.
1. Protect Your Loved Ones and Ensure Their Well-being
An estate plan allows you to protect your heirs by ensuring they receive the distributions you intend for them. It also helps ease the burden on those you leave behind by providing important information, such as contact details, funeral preferences, and a comprehensive list of your assets. This can be particularly important for blended families, where an estate plan can outline specific distributions to protect your children and ensure everyone is cared for according to your wishes.
Additionally, an estate plan enables you to arrange for the financial care of your family and dependents and establish guardianship for minor or incapacitated adult children, ensuring they are cared for by someone you trust.
2. Maintain Control Over Your Assets and Decisions
Having an estate plan empowers you to maintain control over how your assets are distributed and who will manage your affairs. By creating a trust as part of your estate plan and ensuring that all your assets are held in the name of the trust, you can relieve your surviving loved ones of the stress and complexity of the probate process, potentially avoiding it entirely.
An estate plan allows you to clearly direct how your assets should be distributed, preventing state law from determining the distribution of your estate if you pass away without a plan. You can designate a trusted person to manage your asset distribution as a personal representative or successor trustee.
Additionally, an estate plan protects you in the event of incapacity by allowing you to appoint agents through powers of attorney for medical and financial matters. You can provide specific instructions in these documents to ensure your wishes are honored, giving you peace of mind that your affairs will be handled according to your preferences.
Trust vs. Last Will and Testament: Understanding Your Options
When deciding between creating a trust or a last will and testament, it is essential to understand the differences and benefits of each.
Trust
A trust allows your surviving loved ones to avoid the often lengthy and public probate process, provided all your assets are titled in the name of the trust. Probate can take anywhere from six months to two years, potentially delaying the distribution of your assets. However, it’s important to note that a trust does not protect your assets from liability to creditors.
Last Will and Testament
On the other hand, if you create a last will and testament without a trust, your heirs will have to go through the probate process to distribute your assets. This can include any probate assets not named in the trust, such as real property, bank accounts without a payable-on-death beneficiary, or personal belongings.
One advantage of a trust is that it allows for a more controlled and potentially lengthy distribution process to beneficiaries, enabling you to time the distributions according to your wishes.
Ultimately, the choice between a trust and a will depends on your specific needs and goals, but understanding these key differences can help you make an informed decision.
Conclusion
Estate planning is a critical part of life planning that shouldn’t be overlooked. It’s about more than just distributing assets; it’s about protecting your loved ones, securing your legacy, and ensuring that your wishes are honored.
At Fowler St. Clair, we are here to guide you through the process with care and expertise, helping you create a plan that meets your unique needs and provides peace of mind for the future.