As you enter your golden years, you must plan how to pass on your assets to your loved ones. It’s natural to feel overwhelmed when it comes to estate planning. But since you’ve poured your life into building your wealth, you would want to distribute it properly among your loved ones.
When it comes to estate planning for seniors living in Utah, wills and trusts are two popular options. Both legal instruments allow you to pass your assets to your heirs according to your wishes. However, that’s where the similarity between these two ends.
Knowing how these two instruments differ, can help you decide which one is right for your estate planning goals. We’ve taken the liberty to compare these two options for you.
Let’s get started.
What is a Will?
A will is a legal document that spells out what happens after you kick the bucket. It puts everything in writing, from who gets what to your funeral arrangements and last wishes. It’s a simple yet effective way to create your estate plan. You should set up your will as soon as possible to protect your family and legacy unless you are among the 32% of Americans who already have it.
How to Set Up Your Will
While setting up your will is easy enough, we recommend consulting a seasoned estate planning attorney in Utah, especially if you have several assets. Once you hire a lawyer, they can guide you through the process, which may include:
1. Listing Your Assets: Decide what you want to include in your will. Technically, you can list everything, including all your property, bank accounts, insurance policies, jewelry, and personal items. If you leave something out, it will be handled as per Utah’s intestacy laws.
2. Choosing Beneficiaries: Once you have listed everything you wish to include in your will, decide who gets what. You can leave your assets to your family, friends, non-profits, or charities. If you have children who are minors, you can name guardians for them in your will.
3. Naming an Executor: The executor will carry out your wishes. They pay your outstanding debts with your remaining funds and ensure everything goes where it should. This personal can be anyone, including a trusted family member, friend, or an estate planning lawyer in Utah.
4. Signing the Will: After the Will is ready, you need to sign it in front of witnesses. They also sign to confirm they saw you sign it.
What Is a Trust?
A trust is a legal instrument that allows you to distribute your assets to different beneficiaries. Trusts offer more control and come in different forms, including some types that can help you save taxes, which is critical in estate planning for seniors.
How to Set Up a Trust
A trust can strengthen your estate planning, but the process can be a little more complicated than writing a Will. You should consult an estate planning lawyer in Utah to help you set it up.
The process typically involves:
2. Choosing the Type of Trust: There are different types of trusts, but a revocable living trust is the most popular choice when it comes to estate planning for seniors. You can modify it while you are alive, but it needs to comply with Utah’s trust laws.
2. Listing Your Assets: Like a will, you will need to choose what you want to include in your trust. You can include almost everything you want, from cash and real estate to stocks and bonds.
3. Naming Beneficiaries: Decide who will receive your assets. You can add any number of beneficiaries, who may be family members, friends, non-profits, and charities.
4. Choosing a Trustee: You will need to appoint a trustee/s who will manage your trust. It can be you, someone you trust, an organization, or even an estate planning lawyer. But we recommend choosing professional trustees as they are more likely to be unbiased and often have experience dealing with trusts like yours.
5. Transferring Your Assets: Whether real estate, bank accounts, or investments, you will need to transfer your assets in the name of your trust. A competent lawyer can help you complete these transactions.
6. Creating and Signing the Document: Your trust document outlines the rules and regulations of your trust. You would want to discuss these details with your Utah estate planning lawyers. This includes discussing details like who can manage your assets if you become incapacitated prior to your death and who can handle the assets you have outside of the trust. When the document is ready, you will need to sign it in front of a notary public.
Will Vs Trust: Which Is Better
When it comes to estate planning for seniors, both Wills and Trusts are a great option. But choosing between the two depends on your situation.
Here are a few key points you might want to consider:
1. Cost: Typically, setting up a Trust is more expensive than a Will, which can cost only a few hundred dollars if you hire a lawyer. But for complex Trusts, you may have to pay between $3000 to $5000.
2. Probate: In Utah, a Will goes through probate court. This process not only takes several months but also makes your Will public. On the other hand, setting up a Trust helps you avoid probate, letting your beneficiaries get their inheritance faster and privately.
3. Control Over Assets: While a Will is cost-effective, it takes effect only after your death. However, a Trust can come into effect while you are alive. You can set its rules and modify them depending on your circumstances.
4. Flexibility: A Will is relatively easy to change. You simply have to create a new one or add an amendment to the existing Will. But changing the terms of your Trust can be a little more complicated. If you have an irrevocable trust, you might need a court order and approval from all beneficiaries to make any changes.
5. Taxes: Certain types of Trusts can offer tax benefits, which is worth considering if you have a large estate. However, a Will does not offer any such benefits.
6. Special Conditions: If you become incapacitated before your death, a Will is not enough to specify your requirements. You will need to create a power of attorney to let someone you trust handle your estate on your behalf. But when you set up a Trust, you can include instructions for managing your assets if you are unable to do so in the future. This often simplifies estate planning for seniors in Utah.
7. Family Situation: In addition to these, you might also want to consider your family situation when making this decision. Generally, a Will can be enough to sort everything out if you have fewer assets and a small family. But for more complex family situations and large estates, you might want to consider setting up a Trust to avoid conflicts.
Whether you want to set up a Will or a Trust, you should consult skilled Utah estate planning lawyers first. They can help you choose the right option and complete the legal formalities without delays or errors.
Conclusion
Technically, everyone has an estate. If you are a senior living in Utah with a house, a car, personal belongings, cash, and bank accounts, you should consider planning your estate as soon as possible. Speak with an estate planning attorney to understand your options and make things easier for your loved ones after your death.
At Jeremy Atwood Law, our seasoned lawyers can help you develop your estate plan, including Wills and Trusts. Fill out our online form or call (801) 682-5234 today to schedule a free consultation.
