Living Trust Or Will

by Dan Carter

This Article is designed to be of general interest. The specific techniques and information discussed may not apply to your area. Before acting on any matter contained herein, you should consult with your personal legal adviser. The laws ruling on probate differ in each state. What happens to the value of estates in probate sales? As in all other probate proceedings, probate sales are conducted only after your death. One way to bypass a costly and lengthy process, is to have a living trust. All property contain with in the Living Trust will past to beneficiaries with out dispute. Probate fees including referee fees, court costs, and attorney costs can take away 6% of the total estate value: real estate, personal items, cars, boats, bank savings, securities, retirement funds. One can proceed with the probate sale by oneself. The court clerk will give you all necessary forms to fill out. If this option is chosen proceed with caution and with your own risk of costing the estate to lose more value from the mistakes that you may make along the way from not understanding the way that the probate courts work.

Trust vs. Will Considerations

There are many positive reasons to establish a trust but do not overlook the fact that it will involve more upfront effort and expense to set it up properly. To determine if you should make the extra effort and invest in the expense of a trust, answer these questions.

Is informal probate an available option? Most states have an expedited or simplified form of probate for estates under a certain dollar threshold (that dollar value varies by state). If your estate could pass under an expedited form of probate, or if you live in a state where probate is not a complex or burdensome process, a will could be appropriate.

Do you own more than one piece of real property? If so, you may want to consider a living trust since each property will likely be subject to some form of probate.

Do you have minor children? If you do have children, a trust may be appropriate. It allows you to name a guardian for any minor children (so does a will) to establish provisions specifying particular life events when a child will be entitled to any assets held in trust.

Do you have children, grandchildren or other dependents with special needs? In those instances the access or control those heirs have over their inherited property may need to be limited. With a standard will your property can be passed on to those heirs but a will alone does not allow you to exercise much control over their use of the property.

Will your estate be subject to estate taxes? If the value of your estate (all possessions including home, life insurance benefits, retirement accounts) will be $1.5 million or higher (as of 2004 and 2005) you may wish to consider setting up a trust with tax planning provisions, such as an AB or an ABC trust.

Will you actively manage your estate plan? If not, a living trust may not be a suitable solution. Again, a trust will only be beneficial if assets are transferred into it.

So what is best for you? In many respects, a living trust and a will accomplish similar objectives. A trust, however, allows you to realize other objectives that a will cannot. But those advantages don't come without a price. Whether or not a living trust is better for you than a will depends on whether the additional advantages are worth the cost. When choosing, remember one size does not fit all. What is right for one person may not be right for everyone. Your estate plan should be prepared in a way that best meets the needs of you and your family.

Times are changing and we are witnessing a new era of economic misery. This misery index is called "The Cost of Dying", and it measures the aggregate cost of final sickness and death in financial terms.

Probate is not the only hardship your estate will suffer. Today you must add other substantial cost considerations to your estate planning.

They deserve your careful consideration if you are to avoid the difficulties and financial pitfalls that can destroy all you've worked hard to accumulate and to pass to your children.

This article does not address all the intricacies associated with wills and living trusts. Consulting with a competent attorney can help you make the right decision.

The term Probate is often used to mean the issuing of a document from Her Majesty's Courts Service (HMCS) (sometimes known as the Probate Court) allowing someone to take on the responsibility of dealing with the estate. This article cover the function to under stand the concept of planning your estate to minimize the transfer of your estate to your beneficiaries. It not a guide to follow to set up estate. Seek and estate attorney to find what will be best for your situation.

Source: http://www.goarticles.com/cgi-bin/showa.cgi?C=1030784