Charlie D.
Golden Triangle-E. Texas
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This question is to obtain a little info. and not asking for legal advise.
Wife and I visited an attorney to set up our will. I told the attorney that I know of some people who have set up a trust. His opinion is that a will would suit us better than a trust and, IIRC, a trust may require a will under some circumstances.
Can anyone explain, in layman terms, the difference of a trust vs. a will? We have one child, age 37 and one grandchild 5 months old. Home paid for, checking and money market accounts and additional money market account and 401K at my broker. Wife never worked outside the home so the 401K is in my name with her as 1st. beneficiary and son the second.
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Doug4.7
Hartselle, AL, USA
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I won't discuss any of the details, but my parents have a trust and they seem to think it provides for more of their estate going to their kids than a regular will. It is a bit complicated.
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Mike and Trish
Mt. Airy, MD
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There are many places on the web that will provide better answers than you're likely to get here -- just Google "trust vs. will" or similar, and you'll get more info than you could ever read.
My understanding is that everyone should have a will, but only for those in certain circumstances is a trust necessary. Basically, a will distributes your assets when you die, while a trust manages those assets for a period of time after (or even before) you die.
This is one place you really need a lawyer's expert advice.
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downtheroad
Pacific Northwest
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When ALL assets are placed inside a trust, there is less chance that the estate will be probated by the state or anyone else - not so with a will.
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Dave E
Mid Illinois
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downtheroad wrote:When ALL assets are placed inside a trust, there is less chance that the estate will be probated by the state or anyone else - not so with a will.
exactly, also some people don't want others to know what they had, since a will is public knowledge they like a trust since it is not, and usually a trust is recommended when the inheritance is approaching the limits for taxes in your state since you can leave it in trust forever and I believe the trustees pay no inheritance taxes if applicable in a will situation. You need to see an attorney to see if one would be right for you
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Jim Shoe
Amelia, OH
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There are other reasons, but a big one is that Wills have to go thru probate and become public records and can be contested by "long lost" relatives. A probate judge can change the terms of a Will. "Your Honor, old Uncle Festus promised me those 300 acres of farm land that are now surrounded by industrial sites." A Trust distributes your estate per your instructions in the document by the successor Trustee(s) that you name.
A properly drawn Trust can already hold title to all of your real and personal property with you as the trustee. As Trustee, you can use the assets in the trust as you do today without any court's permission, but the provisions in the trust take over immediately after your death, without going thru Probate.
If you think you may have some of those long lost (or even not so lost) relatives that might try to break your Will, speak with a Trust Attorney to see if a Trust is right for you.
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msmith1199
Central, CA
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Laws vary by state. In California assets not in a trust have to go through probate. Don't ask me the fine details, but I know probate can involve hiring a probate attorney to oversee it and the probate attorney fee is generally 15% of the estate. With a trust the executor of the trust controls and distributes the assets accoring to the directions in the trust and there is no probate and no attorney to pay. I just went through all of this with my parents. Maybe Texas doesn't have a mandatory probate for your size of estate so that's why your attorney gave you that advice.
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pkunk
Questa, NM
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downtheroad wrote:When ALL assets are placed inside a trust, there is less chance that the estate will be probated by the state or anyone else - not so with a will.
Bingo...correct answer!
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emzee
california
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It's funny Suze Orman was just telling someone that if they lived in California and had only a will that it could take anywhere from 6 months to 2 years for the will to go through probate. It takes one judge to sign it and ok it. You can pay at least $10,000 for that one signature! Going with a trust will assure your assets, advance directives and power of attorney get into the right hands.
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bsinmich
Holland, MI
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Since you have only one child it makes everything a lot simpler. Your 401K can have a beneficiary and so can insurance and annuties. These need nothing to be passed to the beneficiary other than a death certificate. A house can be done with a quit claim deed. I see many people who have everything in a trust and when I look into their estate nothing has actually been put into the trust. I was also an only child and inherited everything at my mother's death when she was 96. My DW is still waiting for her mother's estate to be settled from '03. Unless you have over $1,200,000 that is not named in beneficiaries I would stick with your attorney. For a trust to be effective you should have everything put into your trust and then a pour-over will putting the misc. into the trust. This is where most people don't follow through.
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