Do You Need a Will?

The short, and long, answer is yes. Everyone needs a will.

A will is a legal document that sets forth your wishes regarding the distribution of your property and care of minority children.

Benefits

A will can minimize tensions between survivors on who gets what. If you don’t have one, the courts will decide by a process called probate. We’ve all heard the horror stories of families fighting with each other, only to end up not speaking to one another. A will gives you the peace of mind that makes sure your wishes are carried out and things like this don’t happen.

Wills are also quite flexible and affordable. They are easy to change to match your current circumstances. Many think only rich people need wills and are the only ones who can afford them. On-line sites like LegalZoom offer packages for as low as a couple hundred bucks. Use in conjunction with a living will, which dictates your wishes regarding medical care should you become incapacitated.

You need the following to set up your will:

• Name of executor (make sure they want the job)

• List of your asset and debts

• Names of minority children

• Name of custodian (definitely make sure they want the job)

• Provide a breakdown of who gets what of your assets

Trusts

A trust controls what happens to your property after you die. A common misconception is that only rich people need to set up a trust. The misconception is that trusts reduce estate taxes. They do not. They are an effective method of paying them. Any sized estate can benefit from a trust because of the efficiency of distributing assets.

The most common form of trusts is living trusts. With a living trust, you have the flexibility of making changes. With an irrevocable trust, once you create it, that’s it. It will be ironclad in a court of law. You must fund the trust with assets for it to be enforceable. Simply move all of your assets (financial) to the trust and name yourself the executor. After you die, name the same executor of your will the executor of your trust.

Many people get confused trying to determine the difference between a will and a trust. A will passes property to your heirs. A trust determines how that property is distributed.

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