Estate planning is essential for anyone who wants to ensure that their assets are distributed according to their wishes after they pass away. Two of the most common estate planning tools are wills and trusts. While they both serve a similar purpose, they have different functions and can be used in different situations.
A will is a legal document that outlines your wishes regarding the distribution of your assets after your death. It typically names an executor, who is responsible for administering your estate and distributing your assets to your beneficiaries. A will can also name guardians for minor children and specify funeral arrangements. One of the primary advantages of a will is that it is relatively straightforward and inexpensive to create. However, a will must go through the probate process, which can be time-consuming and costly.
On the other hand, a trust is a legal entity that holds your assets and distributes them according to your wishes. There are different types of trusts, but the most common type is a revocable living trust. With this type of trust, you can transfer your assets to the trust while you are still alive, and the trust will continue to hold and manage them after your death. A trust can also provide asset protection and may help you avoid probate.
One key difference between a will and a trust is that a will only takes effect after your death, while a trust can take effect during your lifetime. This means that a trust can be useful if you become incapacitated and are unable to manage your own affairs. A trust can also provide for ongoing management of assets for minor children or beneficiaries who may not be able to manage their own finances.
Another difference is that a will is a public document, which means that anyone can access it after your death, if there is a probate matter. A trust, on the other hand, is a private document. You may share what the trust provides or choose not to share the information.
Ultimately, whether you should use a will or a trust (or both) depends on your individual circumstances and goals. An experienced estate planning attorney can help you decide which option is best for you.
If you are located in Alaska and need assistance with your estate planning, I encourage you to reach out to the Law Office of Constance A. Aschenbrenner. As an experienced estate planning attorney, Connie Aschenbrenner can help you create a plan that meets your unique needs and goals. You can also sign up for one of her workshops at https://akwillstrusts.com/events/ to learn more about the estate planning process and how to protect your assets for future generations.