Frequently Asked Questions
Below are answers to some of the more frequently asked questions that we have answered over the years. If you have a question that you don't see answered below, please email or call 844-287-4919.
01 What's the difference between a Will and a Trust?
A trust and a will are basically the same thing. They are both documents except one says "will" on the top and the other says "trust". The difference between them is really what we do with each of them once they are signed. With a will, once it is signed we put it in a drawer and never look at it again. With a trust, we need to do something with it which is why we call it a living trust. In other words, we need to retitle our existing assets in the name of the trust and make sure that any new assets we acquire going forward are purchased in the name of the trust.
02 Do I need a trust?
The biggest reason for setting up a trust is real estate. Certain assets like life insurance and retirement plans already have beneficiaries associated with them. There is no beneficiary for your house though which is why it is subject to probate upon your death. By establishing a simple trust and then deeding your house to that trust, you can essentially name a beneficiary for the house. Doing so will save your family from cost and hassle of probate.
03 What is Probate?
Probate is a court proceeding. Any time some dies with an asset in their name alone, that asset passes to their "estate". The job of the probate court then is to distribute a decedent's estate. If the person had a will, the will serves as instructions to the judge. If there is no will, then State law applies. The idea behind "estate planning" is to die with a zero estate which would then mean probate is not necessary. Some assets are not subject to probate like anything in joint name with someone else or anything with a beneficiary like retirement plans, life insurance, and POD/TOD accounts. For all other assets, it usually makes sense to set up a trust and then retitle those assets in the name of the trust in an effort to avoid probate.
04 Why do I want to Avoid Probate?
First of all, probate can be very expensive. There are filing fees as well as attorney's fee and other costs required by the court. Secondly, it can take a lot of time. Six months at a minimum but sometimes it can take several years. Third, probate is a very public affair. Just look at the celebrities that have tied recently and all the media coverage of the estate. Finally, probate can lead to unanticipated outcomes. In other words, sometimes people walk away with assets from the estate that they were not supposed to get.
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