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Most people are familiar with last wills and testaments. However, a will isn't the only document you should consider including in your estate plan if you want to distribute your estate to loved ones. A trust can help you achieve these objectives and make the probate process easier for your family and friends in the future.
Understanding why you need a will and a trust (and the differences between the two) can help you develop a comprehensive estate plan that safeguards your legacy. At Hunt Law Firm, PLLC, we provide high-quality estate planning services to Texans.
To schedule a consultation with a member of our team or learn more about our services, contact us online or via phone at (832) 781-0320.
Common Terms in Wills & Trusts
Before going further, it may be helpful to understand common terms used in wills and trusts:
- Decedent. A decedent is a deceased person (typically, the owner of a will or trust).
- Beneficiary. Beneficiaries are named by the decedent to receive certain assets in their will or trust.
- Grantor. A grantor is a person who creates a trust.
- Trustee. A trustee is an individual in charge of a trust. Typically, grantors name themselves as trustees and appoint a successor trustee to administrate the will after they die.
- Executor/Personal Representative. An executor is an individual defined by the decedent in their will to distribute their estate post-death. If the decedent fails to name an executor, the court will do so on their behalf.
- Heir. An heir is an individual who inherits a decedent's property due to line of succession if no will is present. They are often the decedent's closest direct descendant and may be named as an executor by the court if necessary.
- Tangible assets. Tangible assets are physical property, such as a house, a vehicle, a family heirloom, etc.
- Intangible assets. Intangible assets are incorporeal property, such as a bank account, retirement account, benefits, a life insurance policy, etc.
- Creditor. A creditor is an individual a decedent owes money or assets to.
- Probate. After a decedent dies, the executor or another individual can initiate probate. During probate, the court works with the executor to ensure the decedent's estate is properly distributed and creditors are repaid.
What Can a Will Do?
Most people know that a last will and testament enables you to distribute assets to beneficiaries in the event you pass away or become medically incapacitated. However, wills can also:
- Establish Durable Medical and Financial Power of Attorney (PoA). Designating PoA allows you to determine how your health and estate are cared for if you become incapacitated or lack the mental capacity to properly care for these items yourself.
- Establish guardianship. If you have children who are minors, you can recommend a guardian for them in your will. If you become incapacitated or pass away, the guardian will take on a parental role in your stead.
- Establish an executor. A will enables you to define who distributes your estate, instead of relying on the courts to make that decision once you pass away.
What Can a Trust Do?
Like a will, a trust allows you to distribute assets to beneficiaries in the event you pass away or become incapacitated.
The biggest benefit of a trust is that it may enable your family, friends, and loved ones to circumvent probate. Assets awarded in a trust do not go through probate.
Depending on your estate, probate can be a long, expensive process. Utilizing a living trust to award assets to beneficiaries instead of a will enables you to prevent beneficiaries from enduring probate, allowing them to focus on more practical matters and take time to grieve.
For this reason, many lawyers recommend clients consider both a will and a trust when making decisions regarding their estates. At Hunt Law Firm, PLLC, we'll work with you to draft a comprehensive will and/or trust that fulfill your needs and helps you safeguard your legacy.
Contact us online or via phone at (832) 781-0320 to schedule a consultation with our team.