With the variety of estate planning options available to New Jersey residents, it is no wonder that there is a significant amount of confusion regarding how to best plan for the future. Between wills, trusts, beneficiary deeds, and other estate planning tools, there are myriad ways to ensure that your property is transferred according to your wishes.
Importantly, it is not necessary to use one estate planning tool to the exclusion of another, and they can often be used together. For example, creating both a will and trust can ensure that you do not leave anything out of your estate plan and also to address different issues. Some basic information about both is provided below.
Wills
A will is a legally enforceable document that can be used to bequeath assets and property to specific beneficiaries. In addition, wills can also name a guardian for minor children, which a trust cannot do. Assets that are left to beneficiaries in a will have to go through probate, which the process through which an estate is settled. During probate, the will is “proved,” debts are settled, and assets transferred. Probate often costs an estate a significant amount of money in the form of fees for courts, lawyers, appraisers, executors, and other parties who may be involved in the process.
Trust
A trust is a legal arrangement in which assets are held in trust by a trustee for the benefit of someone else. The individual who creates the trust is known as the “grantor” or “settlor” and the party for whom the assets are held are referred to as the beneficiary (or beneficiaries). One of the main advantages of a trust is that assets that are held in a trust do not have to go through probate. In addition, a trust allows for management of assets, which a will cannot accomplish.
Wills and Trust Can be Used Together
For many people, using both a will and a trust is an excellent way to ensure that your assets are managed and distributed in the way that they wish. For example, you can use a trust to protect and grow assets while making sure they will pass to the party to whom you intend without the complications associated with probate. By also making a will, you can name a guardian for your minor children and also account for what will happen to assets that you leave out of your trust by mistake or design.
Call 732 238-8686 today for more information.
If you are considering creating a will or a trust, you should speak to an attorney at Bowne Barry & Barry as soon as possible. To learn more about how we can help you with your estate planning needs, call our office today at 732 238-8686 or contact us online.
