When it comes to estate planning, one of the biggest questions most people need to answer is whether they should create a will or a trust. Because this is a major decision, it is important to understand the differences between these two estate planning tools. That said, one is not “better” than the other. Instead, it is a matter of which tool best meets your needs. A Palm Beach County estate planning attorney can help you determine whether a will or a trust would be best suited for your estate planning goals.
What is a Will?
Perhaps it’s best to start with a basic understanding of a will. In very simple terms, a will is a legal document that sets forth how your property will be distributed among your heirs and beneficiaries upon your death. Your will can also direct who should care for your children or any other dependents you may have.
The will also identifies someone who will act as the personal representative of your estate (often referred to as an executor or administrator). The personal representative is responsible for overseeing the administration of the estate according to the express terms of your will. This includes filing your will with the probate court in the jurisdiction where you died and navigating the probate process.
Wills can range from simple instruments to lengthy, complex documents that handle complicated issues in sophisticated estates.
What is a Trust?
A trust is similar to a will in that you can use it to administer your estate to your heirs and other beneficiaries, but it differs from a will in several important ways. When you (the grantor) creates a trust, you place your assets under the control of a trustee who manages those assets for the sake of a beneficiary. The trust goes into effect immediately once it is funded rather than upon the grantor’s death, as with a will.
The trustee is similar to the personal representative of a will. The trustee has a fiduciary obligation to manage the assets of the trust for the benefit of the beneficiaries. However, the trustee does not manage the trust under the guidance of a court. While the administration of a will is overseen by the probate court, a trust is managed according to the terms of the trust agreement.
The most common trusts used in estate planning are living trusts. They are created while the grantor is still alive, and the grantor is often named as the trustee with rights to enjoy the assets of the trust during their lifetime. As a result, the grantor is able to retain control of the estate even though the assets are owned by the trust. In addition, living trusts are revocable, meaning that the grantor can terminate or modify the trust at any time to suit their needs. For this reason, trusts provide a great deal of flexibility for the grantor.
Contact a Palm Beach County Estate Planning Attorney
There is no “one size fits all” answer to which estate planning tool is right for you. At Comiter, Singer, Baseman & Braun, we pride ourselves on finding the best possible solution that meets your unique needs. If you would like to discuss your estate planning goals with an experienced Palm Beach County estate planning attorney, contact us online or by calling us at 561-626-2101 or toll-free at 800-226-1484. We work with clients throughout the state of Florida.