Setting up an adequate estate plan can serve several important purposes. The first is to make sure you are taken care of according to your exact wishes when you can no longer care for yourself. The other is to ensure that your loved ones are taken care of when you pass away. Two of the main vehicles we use to accomplish these goals are wills and trusts.
When someone dies without a will or trust, the state of California will typically determine what happens to your money and your property after your death. This is known as intestacy and is something that most people want to avoid if they can. Many people do not trust the state to make these important decisions for them, but fortunately, having these decisions made by the state can be avoided through the establishment of a will or trust.
What's the difference between a will and a trust?
A will is a document that comes into effect once you die. This document is used to decide how your money and property are distributed. When someone dies with a certified will, a judge will oversee the process of distributing property and assets according to the provisions outlined in the will. This is known as probate, a process that can be very costly and time-consuming. Due to these circumstances, most people wish to avoid the process of probate through the establishment of a trust.
A trust is a document that allows us to avoid probate and override the state's intestacy laws. This means that you can transfer money and property to all of your intended beneficiaries without the involvement of the court. You, the grantor, place property and money into a trust, which can then be divided and distributed according to your wishes after you die. This means re-titling your deed and other accounts into your trusts name. A trustee can then manage these assets until the time comes for them to be divided and distributed. While you are alive, you will be the trustee over the account. Should you no longer be able to manage your affairs, a successor trustee that you nominate will take over. When you die, this successor trustee will coordinate the division and distribution of all trust assets to the beneficiaries.
There are also several different types of trusts that can be used for a variety of different purposes. These purposes can range from asset protection planning, tax planning, veterans benefit planning, Medi-Cal planning, and special needs planning. The Estate planning experts at OC Elder Law can help you create a comprehensive solution to provide for the needs of you and your family using innovative strategies that fit your unique situation. If this involves a trust, we'll walk you through the steps in an easily digestible way so that you can accomplish your goals and protect the future for you and your family.