5 Things a Trust Can Do that a Simple Will Cannot
So, you’ve finally decided it is time to update your estate plan (or create one for the first time). Maybe you’ve looked online or read up on how to get your Will done quickly, and you are starting to wonder if a Will can actually accomplish all the things you want it to. If this sounds like you, then pay attention.
At Meyer & Spencer, P.C., we go far beyond just giving clients documents. We perform careful estate planning and advisory services to help people keep more of their money, prevent losses, and control their retirement options. One of the greatest ways to maintain control and ensure that your wishes are carried out after you are gone is to create a carefully drafted Trust. Here are 5 things a Trust can do that a simple Will never can.
#1 Create Conditions
A Will, by definition, just establishes your intent. It tells a future probate judge and your family where you want your things and your money to go when you are dead. But it stops there. You cannot effectively control things much beyond death. Once you are deceased, your assets are subject to your Will’s declarations, when they are gone. They belong to other people now.
On the other hand, a Trust survives you. By putting money and possessions into a Trust, you delegate your control to a Trustee who can continue to honor your wishes long after you are gone. You can even create conditions, such as making certain bequests dependent on educational accomplishments.
#2 Protect Spendthrifts
You hope that your children, spouse, and even grandchildren Will honor you by living good lives. You hope that your heirs will all remain upstanding members of the community, responsible and capable of making good use of your life’s earnings. But hope is not enough. What if one of your children becomes a drug addict or chronic gambling addict? If you leave assets through a Will, they may quickly be squandered. A Trust gives you the option of including provisions to withhold funds, reduce bequests, or even shift inheritances to other members of the family in these situations, all for the sake of protecting the Trust assets. So-called spendthrift provisions can be very helpful.
#3 Avoid Probate
Many people make a Will, because they think it will help them avoid probate. In truth, a Will does nothing to avoid probate. Under New York law, with certain exceptions, if you have assets in excess $30,000, then your heirs will need to open an estate in probate court if they want to distribute your property. Having a Will is great, because it tells the court what you want. It can also waive bonding requirements. But it doesn’t avoid the process. A Trust, on the other hand, can avoid probate, because Trust assets are technically not your assets on death.
This goes hand-in-hand with avoiding probate, but having a Trust is a very private matter. With the exception of situations where someone files a formal dispute, or your Trust ends up in court, a Trust administration is entirely performed in private without any public filings. Your Trustee can distribute funds to heirs, open and close accounts, pay bills, and sell real estate, all without a single public court filing.
Having a Trust does not mean you must use it for everything. Some people use their Trust for their real estate and cash holdings, while choosing to keep a lot of other things in beneficiary accounts, like retirement funds and pensions. A Trust offers superior control, flexibility, and versatility that a Will never can.
If you want to discuss how you might be able to use a Trust to protect your estate and help your heirs retain more of the money and assets you’ve spent your life working for, call the Westchester County estate planning lawyers at Meyer & Spencer, P.C. today.