When you’re planning your financial future you might be wondering when it makes sense to set up a will or living trust? Almost everyone can benefit from some form of will, no matter how basic. Of course, if you have absolutely no heirs, or possessions, then a will might not be necessary. But, for almost every other situation you could benefit from writing a will.
What Happens Without A Will?
When you don’t have a will the state you reside in will determine who gets what based upon intestacy laws. These laws are different depending on the state you live in, but will normally distribute your assets starting with immediate family like your spouse, children, and parents. Then the state will determine who the most important relatives are.
When you don’t at the very least name an executor of your will, then the probate court will appoint a person who is responsible for handling all of your affairs. The functions they perform will include: gathering all of your estate assets, paying any taxes or debts that might remain, and then distributing the assets to the beneficiaries.
Basic Contents Of Your Will or Living Trust
Most wills will include instructions of how your property is to be distributed at your time of death. You can alter your will at any time during your lifetime.
A living trust can be used to manage property during and after your death. You can also avoid excessive fees, taxes, and see a host of other benefits.
Top Reasons To Have A Will or Living Trust
A will or living trust will enable you to legally protect your spouse, children, and assets. It will also give specific instructions of how your affairs are to be handled after you’ve passed.
1. Control over distribution of your estate
You’ll be able to decide exactly how you want your estate distributed and to whom. This will also help to end potential disputes over your estate before they have chance to arise.
2. Decide who will take care of your children
If you have minor children you’ll be able to decide who will take care of them once you pass. This allows you to appoint the person you want to raise your children, and avoid them being raised by the person you don’t.
3. Avoid the probate process and minimize taxes
The probate process is very lengthy, but you can avoid putting your family though this process by having a will that explains exactly how you want your estate divided.
Having a will allows you to minimize the taxes that will have to be paid on your estate. What you give away to charities or family members will be deducted from the total amount of your estate that will be taxed.
4. Make gifts or donations
If you want to give money to a certain charity or cause you can specify the exact amount in your will. Gifts up to a certain amount will be disclosed from estate tax, further reducing the amount they’ll have to pay.
5. Decide who will execute your estate
Executors will determine how your estate is handled. This includes things like: paying off bills and debts, and notifying different organizations and banks of your passing. This person plays a large role, so you’ll need to appoint someone you can trust.
If you’re interested in getting started with your living trust or will it can be helpful to work with a professional. Get in touch with our legal team to schedule a free consultation today.