For most people, estate planning begins with the creation and execution of a Last Will and Testament. A comprehensive estate plan, however, will include additional estate planning tools and strategies that help you achieve a wide range of inter-related goals and objectives. One of the most common additions to an estate plan is a trust. Like most people, you are probably familiar with the overall concept behind Wills and trusts; you might be surprised at what you don’t know about Wills and trusts. With that in mind, the Wills and trusts attorneys at Kulas Law Group have put together some frequently asked Wills and trusts questions and answers for you.
I’m too young (too poor, not married etc.) to need a Will aren’t I?
People offer all sorts of explanations for why they have yet to create even the most basic estate plan. The simple truth is that every adult can benefit from having an estate plan in place, without regard to age, marital status, or net worth. At a bare minimum, executing a Will ensures that the State of Florida will not determine what happens to your estate assets and will decrease the possibility of expensive – and potentially destructive – litigation after your death.
Can’t I just use one of those DIY Will forms I found on the internet to save money?
This is a very common mistake people make. In today’s electronic age, it is easy to find just about any DIY legal form you might need. Although it is understandable that you might see an opportunity to save time and money by using one of these forms, the reality is that you are more likely to cost your loved ones a considerable amount of unnecessary time and money when it comes time to probate your estate. DIY Will forms are notorious for having mistakes, errors, and omissions that lead to protracted litigation during the probate of an estate. Your Last Will and Testament is something you want done right – the first time. To make sure that is the case, work with an experienced estate planning attorney during the creation and execution of your Will.
Should I use a Will or a trust to distribute my estate assets?
This is something that can truly only be decided after consulting with an experienced estate planning attorney; however, there are some common considerations when deciding whether a Will or a trust should be used. If your estate is small enough to qualify for small estate administration, and you do not have minor children (nor plan to have any in the near future), a Will usually will suffice. If, however, your estate is large enough that probate avoidance is a consideration and/or you do have minor children who will inherit from your estate, a trust is often the better choice to distribute your estate.
What is a trust?
Although every estate plan is as unique as the individual creating the plan, there is a good chance you will include a trust in your estate plan given how popular they are. At its most basic, a trust is a relationship whereby property is held by one party for the benefit of another. Trusts are broadly divided into living trusts and testamentary trusts with the former activating during the lifetime of the Settlor (the creator of the trust) and the latter typically being activated at the time of the Settlor’s death by a provision in the Settlor’s Will. Living trust can be further sub-divided into revocable and irrevocable living trusts while a testamentary trust is always revocable because a Will is always revocable.
What does a Trustee do?
The individual who holds the trust property is the Trustee. In general, a Trustee is responsible for administering the trust terms as well as protecting and investing trust assets. In practice, however, the duties and responsibilities of a Trustee are often diverse and complex. One of the most common mistakes Settlors of a trust make is to name someone as their Trustee without first gaining an in-depth understanding of what will be required of the Trustee and the skills and abilities a Trustee needs to properly administer the trust.
Why might I need a trust in my estate plan?
The flexible nature of a trust is one reason that trusts are so often found in an estate plan. Among the numerous and varied estate planning goals that can be furthered using a trust are:
- Probate avoidance
- Pet planning
- Medicaid planning
- Asset protection
- Incapacity planning
- Special needs planning
- Protecting the inheritance of a minor child
- Charitable gifting
- Managing distributions to beneficiaries
- Tax planning
For more information about Wills and trusts, contact the experienced Florida estate planning attorneys at Kulas Law Group by calling (772) 398-0720 to schedule an appointment.