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Wills and Trusts, the Cornerstones of Estate Planning

Often individuals believe that they are not in need of an estate planning tool because they do not have enough assets. However, you do not have to be wealthy, or own a lot of property, to realize the benefit to you and your loved ones. Estate planning tools such as wills and trusts are the cornerstones of estate planning and can provide much needed protection for yourself and your beneficiaries, particularly if you have minor children.

Why Do I Need a Will?

A will, also known as a last will and testament, is a legal document that directs how your assets will be distributed after death. If you have children, your will can also be used for the appointment of a guardian. However, you can not use a will to place conditions upon your gifts.

Can a Trust Agreement Help Me?

A trust can be an extremely useful estate planning tool for you and your family. It may dictate how and when your assets are distributed to your chosen heirs and can reduce estate and gift taxes. A trust can also generate income and distribute assets while you are alive.

There are various forms of trusts to suit your needs. The most common trusts are the revocable living trust and the irrevocable trust.

  • The term revocable indicates that the trust provisions can be changed at any time and property can be removed from the trust. A revocable trust can contain a spendthrift provision, which can limit a minor child’s access to the property until he/she reaches a certain age, or meets some other condition.
  • An irrevocable trust, on the other hand, sets the trust provisions in stone, and once property is transferred to the trust, the property belongs to the trust. Sometimes an irrevocable trust will be used to limit a minor child’s access to a trust, or trust property.

If you interested in learning more about estate planning, the experienced and caring attorneys at Bellah Perez can you help you determine which estate tool best fits your unique circumstances.

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Set up a consultation with one of our experienced estate planning attorneys today. Contact Bellah Perez, PLLC at 602-252-9937.

FAQ’s

A will is a legal document that names individuals or charitable organizations who will receive your assets after your death either by gift or in trust. A will nominates who will be appointed to manage your estate, pay your debts, and distribute your estate according to the instructions in your will. It can also nominate guardians for your minor children.
Most assets can be subject to the provisions in your will. However, some securities and bank accounts that have designated beneficiaries, such as “payable on death” accounts, pass directly to the beneficiaries and bypass distribution through a will. In addition, certain co-owned assets also pass directly to the surviving co-owner regardless of any instructions in your will.
A revocable living trust is a legal document that can substitute for a will. Your assets will be put into a trust, which will be administered for your benefit during your lifetime and transferred to your beneficiaries when you pass away – all without the need for court involvement. A living trust does not always eliminate the need for a will. A will may still be used to distribute any assets that have not been put into your trust.