For many, estate planning and a will are the same thing. The terms seem almost synonymous with each other till you realise that legally speaking, they are very different processes. An easy way to explain it is that even though both explain to your relatives what you wish to do with your property after death and how it should be handled, estate planning goes into more detail, helping you sort out things like health and finances, while still alive. An estate planning lawyer can help you with the kind of planning you might need and assist you with creating and collecting all of the documents required for a comprehensive estate plan that can accurately and simply distribute your property and more after your death.
Here, we shall go into further detail about will and estate planning laws.
What are the main differences between a will and a trust?
Here, we shall talk about the simple differences between the two before elaborating on the two legal processes.
The basic difference between a will and a trust is that a will gives instructions for what will happen to your assets and properties after death, which a living trust is legally valid while you are still alive. The problem with choosing between the two is that it is hard to figure out which one is the ideal option, and considering you have worked hard your whole life to build up these savings, you do not want unnecessary fees, legal costs and taxes to set you back.
With this in mind, for a long time the will has been the more popular choice, because it has always been made to seem as though using a will is the better option. However, legally speaking, it might not be. A will involves the probate process, which carries unnecessary costs with it. a probate process is a legal process where the authenticity of a will is validated through various methods. With a living trust, even though the upfront costs will be higher, not only is no probate required, but it is the more affordable option with more benefits in the long run.
What is will planning?
Will planning in and of itself is a relatively simple process that requires you to write a last will and testament. You can direct who takes care of your children after your death, who should receive your assets, who your business goes to, and any other property related wishes. Your last will and testament requires an executor who is appointed to make sure all of the instructions in the will are carried out. A will helps avoid family disputes over your assets after your death, and makes the legal processes easier.
What is estate planning?
Estate planning is an intensive process that requires a lot of different types of documents, as mentioned earlier, that helps secure your assets after your death. Your last will and testament is included in these documents. Here is a comprehensive list:
- Living will
Additional documents like these will be able to tell people what your requests are while you are still alive. A living will explains what you would like done in the event that you are unable to speak or have a medical emergency. These include end-of-life care, use of extraordinary measures and many more factors. Using a living trust can not only help your family save money, but also make difficult decisions in difficult times.
- Estate planning with a financial power of attorney
Financial power of attorney is essentially the process of having a designated appointee instructed on how to handle your finances if you are unable to control them. The appointee will be allowed to make financial transactions, decisions about the business and other financial choices which match up with your own wishes and within restrictions that you can dictate. This is the document that helps your assets stay protected and keeps your family financially stable.
- Beneficiary designations
These are some other documents that can help secure your assets. A living trust outlines your wishes regarding your finances and property, but it also goes in-depth into how to offer additional protection for your crucial assets. Beneficiary designations, on the other hand, explain who gets to receive money from your retirement savings, life insurance policies and other financial assets and savings. When put together, these documents create a solid estate plan that supports your family after death but applies immediately during your life.
Why you will probably want to choose an estate plan
Estate plans are a more solid and comprehensive way to plan out what needs to be done after your death. If you have a big family, you will probably want to be more specific about who you want to leave what to. Of course, if you have a smaller family, or have few people to give to, you can simply write it out in a last will and testament, even though a probate will still be required after your death. However, for the majority of people, if there have been many variables in their life, like having more than one marriage, being a donor for a charity, owning a company or business, or having specific requests that they do not want ignored, like the assets interior design being given to the wrong people, then using an estate plan is the way to go. Another reason estate plans are a better idea is if the children are not mature enough or old enough to inherit the assets after your death, so the estate plan will establish a trust that gives them access when they are ready.
Hiring one of the best property lawyers can and will help you sort out the documents mentioned above in a comprehensive manner. They are bound to carry out your wills and give you legal advice in how to proceed with these complicated matters. You will find that a property lawyer can make life a lot easier.