By Rachel Schneller Ziegler
Clients frequently say “All I need is a simple will.” But is that really true? There is no doubt that your Will is an important part of your estate plan. Your Will states what happens to your property after your death and appoints a guardian for your children. But for many people, especially parents of young children, a Will alone is not enough. You should also create a Revocable Living Trust. This is true no matter how large your estate.
A Trust is a document in which you establish terms for holding, managing, and using your assets. A Trustee manages the assets for the benefit of someone else (the beneficiary). A Revocable Living Trust is a Trust you create while you are living that you can revoke or amend at any time before you die.
Here are some key reasons to prepare a Revocable Living Trust:
- Hold and manage money for children and young adults – Assets left to a Trust can be held and managed for the benefit of your children after your death by a Trustee selected by you pursuant to terms set by you. Without a trust, your property will be distributed to a guardian subject to costly court supervision and terms set by state law, and then distributed outright to children at age 18.
- Avoid probate – Probate is a lengthy and costly court proceeding to distribute assets after your death. Assets in a Trust avoid probate entirely.
- Estate tax savings – A Trust can include provisions that can reduce or even eliminate estate taxes. Without a trust, your family may pay as much as 50% of your total assets in estate taxes.
- Protection from creditors – A Revocable Living Trust may protect assets from the reach of a beneficiary’s creditors after your death.
- Hold and manage money if you become disabled – Assets held in a trust can be managed by a Trustee selected by you pursuant to terms set by you for your own benefit, in the event you become disabled and cannot manage your own assets.
Rachel Schneller Ziegler is an attorney concentrating in estate planning and estate administration in Wellesley, Massachusetts. She is happy to respond to concerns or questions about your estate plan at (617) 641-0000 or firstname.lastname@example.org.
Disclaimer: This information is not a substitute for legal counsel. Nor does it create an attorney-client relationship. Please contact an attorney for advice specific to your needs.