Reasons to Have a Will
- Avoid "Intestacy" - where one passes away without a valid will, state laws dictate the amounts and beneficiaries which usually are not what the deceased would have preferred, and causes a lengthy and timely legal procedure which involves mandatory court intervention
- Bequeath your hard earned, valuable or personal possessions to the persons of your choice
- Devise your property or design legacies to non-family members or organizations
- Donate particular assets to charitable causes and receive tax benefits
- Prevent family strife which often leads to disastrous and prohibitively expensive litigation
- Include conditions that must be met by heirs in order for them to inherit
- Choose a Guardian for minor or dependent children
- Appoint an Executor to oversee the collection and initial management of estate assets
- Select one or more Trustees to manage and distribute estate assets on a longer-term basis
- Provide proper funding and care for minors or disabled individuals
- Maximize tax savings and opportunities (with the usage of built-in trusts)
- Provide financial comfort and convenience during tragic times
- Plan ahead and act responsibly for the welfare and peaceful continuance of one's family
Reasons to Have a Trust
- Asset Management for those whom are not financially savvy or lack the time or resources to monitor their various assets, as well as beneficiaries whom are minors, have substance abuse issues, are prone to spending beyond their budget constraints, receiving government benefits (e.g., disabled), etc.
- Maximize tax exemptions (by using State and Federal Estate Tax Exemptions, allocating Generation Skipping Transfer Tax Exemptions) as well as other available tax credits, exclusions and deductions effectively
- Avoid or minimize unnecessary court intervention, such as:
- Court-Ordered Conservatorship Should One Become Disabled
- The multiple costs incurred to the Court, filing fees, estate inventory and accounting fees, attorney and accounting expenses, etc.
- Maintain Privacy (Wills can be accessed by anyone once filed with the court; while Trusts are not available to the public, nor do the assets in the trust have to be disclosed in the trust agreement)
- Ease of administration and the speed of obtaining access over the trust funds
- Lower the likelihood of a beneficiary contesting the plan of distributing the trust assets
- Maximum control over the distribution of the trust assets:
- Determine which assets each beneficiary will receive
- Create a distribution plan or leave the Trustee(s) discretion over when and in which amounts distributions will be made
- Flexibility
Probate Costs
- Typical attorney fees can cost approximately $13,000
- Typical Executor fees can also cost the estate well above $15,000
- Inventory fees are taken as a percentage of the Estate
- Court filing fees and complications involving litigation and tax matters can easily incur significant fees
- Publication and Recording costs and possible cost of bonds
- Creditor claims and debt collection liabilities
- The average time to probate an estate is 15 to 18 months