Estate planning can be an intimidating process, especially when you are unsure which documents and devices are appropriate for your circumstances. Many people associate estate planning with a will or “last will and testament.” However, having a trust can be an equally important part of planning for your estate. In California, some people choose to use a will or trust while others prefer to use both. As you prepare your California estate plan, you may want to know: Is a will or trust better?
Your California Will
If you are like many people, you may have heard of a will but not have a sense of how this critical device works or why it’s essential to your estate plan. A will, or last will and testament, is a legal instrument that allows its creator (the testator) to leave their assets and property to designated individuals (heirs). When someone dies without a will, their property will be distributed to their surviving family members according to California law. However, this can be highly problematic when someone assumes that their loved ones will distribute their assets in a particular manner. For instance, suppose someone passes away intending to leave their house and other belongings to their romantic partner. Without a will, the surviving partner would not inherit the decedent’s assets. Further, if the two lived together, the partner may have to move out of the home they once shared with the decedent.
For parents of minor children, wills can also be used to name a potential guardian. If the decedent passes away without a will and their children’s other parent cannot assume custody, the court will have to select a legal guardian for their kids. Naming a preferred guardian can help expedite the guardianship process and help ensure that your children are in the care of someone you trust to look out for their best interests.
The testator can also use their will to nominate a personal representative to administer their estate during probate. Naming a personal representative allows the testator to help ensure that someone they trust will serve in this role. Without a will, the probate court would have to appoint an executor to perform this critical function. By providing the name of your preferred personal representative, you can help make certain that the right person will be there to carry out the terms of your will.
Your California Trust
The California trust can be another crucial estate planning device. Often, people think of trusts as financial instruments that only wealthy individuals only use. However, a trust can be an essential part of an estate plan regardless of its creator’s financial status.
One of the most commonly used types of California trusts is a living trust. When the trust’s creator (the grantor) places funds or other assets in a living trust, they become the legal property of the device. The grantor can serve as the trustee and beneficiary of their living trust. The trust will also be revocable while the grantor is alive. This means that the grantor can make changes to the trust terms during their lifetime. When the grantor passes away, the device will continue to operate according to its terms, or trust assets may be distributed to its beneficiaries.
Probate can be a lengthy and expensive process that can tie up assets for years. One of the primary estate planning benefits of using a trust is that trust property can pass to beneficiaries outside of probate. Using a trust also allows the grantor to place conditions on the use of trust disbursements. For example, a grantor may want to create a trust to help their grandchildren pay for college. The trust can be devised in a manner wherein trust disbursements will only be made for specified educational expenses.
Will or Trust?
Depending on your circumstances, it may be in your best interests to have both a will and a trust in your California estate plan. It would be best to meet with an experienced California estate planning attorney to assess what is needed for your California estate plan. Your attorney can help you review your goals and develop the right estate planning documents for your circumstances.
At the Law Offices of Alice A. Salvo, we are experienced California estate planning attorneys who can help you evaluate your situation and plan for the future. Please contact us at 818-676-9572 by phone or use the contact form on our website to set up a free consultation today.