A will and trust are some of the most crucial parts of estate planning. The importance of having a will and trust goes beyond just your money. Nobody wants to think about, let alone plan, for when they’ll no longer be around. Unfortunately, it’s the only way to ensure your family and other dependents are well taken care of after you pass, and while wills and trusts are popular forms of estate planning, creating valid documents is not always straightforward. Start by consulting an experienced estate planning lawyer to answer any questions you have and guide you through the process.
Will vs. Trust: Is There a Difference and Significance of Establishing a Will and Trust?
A will is a legal document that directs how your wealth will be distributed after you die, who takes care of your minor children, and any other final wishes. It also names an executor whom you appoint to fulfill your wishes in the will.
A trust, on the other hand, is an arrangement where you put your assets and property in the hands of a trustee, who then manages and distributes the income to named beneficiaries. In most cases, asset owners name themselves as the trustee during their lifetime, but there’s also a successor trustee who takes over upon death.
Unlike a will that becomes functional only after your death, a trust takes effect immediately after you start funding it. A trust also gives instructions on what should happen should you be incapacitated, while a will doesn’t.
But the biggest advantage of establishing a trust is to avoid the excruciating probate process that’s compulsory when processing some types of wills.
However, this doesn’t mean that one is better than the other because they both serve different purposes. An estate planning lawyer is best suited to assess your situation and advise you accordingly. Never forget the importance of having a will and trust.
6 Reasons Why It’s Important to Have a Will and Trust and the Relevance of Creating a Will and Trust
Wills and trusts offer peace of mind when you know that both your loved ones and assets are in safe hands. Other benefits include:
1. Ensuring Your Assets Are Divided According to Your Wishes.
When someone dies without a will in Nevada, the state’s intestacy laws take over to distribute their estate. The same also happens to any assets you fail to include in the will or trust.
And while this process generally prioritizes spouses and children, you may still have had different wishes on who gets how much. Other dependents you provided for could also be left without any inheritance when the court uses intestacy laws to divide your wealth.
A trust doesn’t go through the probate and administration process, which ensures your wishes are respected to the letter.
2. Protecting Your Loved Ones From Internal and External Disputes.
It’s not uncommon to hear about families stuck in endless legal proceedings because of a deceased’s assets. Dying without a will leaves your loved ones exposed to disputes among themselves and from interested third parties.
This is especially true if you’re in a relationship with dependents that are not recognized by the law. For instance, if you have a child with a partner you’re not legally married to, failure to write a will leaves the people you care about in turmoil about who has the right to get what.
And even though wills can still be contested, having one makes any related court process easier on your family.
Having a trust adds an extra layer of privacy because its contents and wishes are not open to the public, eliminating the chances of a dispute.
3. Laying out Your End-of-Life Wishes.
Wills and trusts contain several other wishes besides assets’ distribution.
In a will, you can state any burial and funeral wishes to lessen the burden of planning on your family during this difficult moment. You can also name a personal representative or executor who ensures the administration of your estate goes smoothly and according to your plans.
With a trust, you can further lay out instructions on what should happen when you become incapacitated and cannot make sound decisions.
Being able to specify such wishes gives you peace of mind and puts everything in order even when you’re not around anymore.
4. Safeguarding the Future of Your Minor Children or Dependents.
If you have minor children who are still dependent on you, leaving a will not only protects their financial future but also their developmental well-being.
A will allows you to appoint a guardian who will look after your offspring when you’re gone.
Children need more than financial support to grow into responsible and independent adults. They also need a loving and stable home. One where they feel cared for and supported in all aspects of life.
You have the power to choose a relative or friend you trust to give your children the future they deserve. This is especially crucial if you’re a single parent. This is the importance of having a will and trust.
5. Save Your Family Time and Money for Probate.
A person who dies without a will is considered intestate. To ensure fair distribution, especially for direct dependents, the estate goes through the probate and administration processes. Nevada’s intestate laws govern this process.
Probate can take anywhere from 6 months to several years for a succession. And even then, there still might be disputes and appeals, forcing your loved ones to spend time and money in court.
If your assets’ value is less than $20,000 and doesn’t involve real estate, the inheritance will be straightforward with a will. Surviving loved ones can initiate the process 40 days after your departure.
6. Avoid Probate Altogether With a Living Trust.
Unfortunately, not all wills escape probate. Any will involving real estate or whose value exceeds $20,000 has to go through probate or administration.
Although the presence of a will hastens this process, it still means more money and time spent in probate court. This is where a living trust comes in.
Estate planning law views a trust as a separate legal entity. Because of this, a trust is not subject to probate.Here you can hold virtually any estate assets like vehicles, bank accounts, real estate, and so on.
Beneficiaries can start receiving money even when you’re alive and continue to do so after you pass. You can also structure your trust to last a beneficiary’s lifetime or even several generations after you.
An estate planning attorney will explain more about living trusts, help you plan for your assets effectively, and according to the law.
When Is the Right Time to Get a Will or Trust?
There’s no right or recommended time to get a will or trust. You can start planning your estate as long as you’re above 18 years and of sound mind, but it can be harmful if you forget the importance of having a will and trust.
But since most people are not financially stable or independent at this age, it’s normal to start thinking about this a few years later in life. Here are some triggers or life events that are signs to get your estate in order. the importance of having a will and trust.
- Opening a savings account
- Purchasing a home or any other real estate
- Marrying or remarrying
- After a divorce
- After the birth of your first and each consecutive child
- Inheriting assets from a loved one
- After purchasing a life insurance policy
When it comes to estate planning, the rule of thumb is to start as early as possible. Remember to update your trust or will regularly too, especially after any of the above life occurrences.
If you’re uncertain of your financial situation and whether you can make a will right now, consider reaching out to an estate planning lawyer for professional legal guidance.
Consult an Estate Planning Attorney to Learn More About The Relevance of Having a Will and Trust
The importance of having a will and trust is for the future and can be understandably overwhelming, especially if it involves a time when you’ll no longer be in your loved ones’ lives.
There’s always a risk of postponing this process for later, and sometimes, it can be too late. There’s also a myriad of state laws and requirements to follow to ensure your will and trust are valid.
Let an estate planning lawyer who has experience protecting the futures of many families in Nevada help yours too. Schedule a free consultation with Gastelum attorneys to get legal guidance on wills and trusts, depending on your situation.
You can reach us on call at 702.979.1455, our email address, info@gastelumattorneys.com, or by filling out our online contact form here.
