In this article, we look at the interaction between Will writing and estate planning to help you determine which process is right for you. Will writing, in many cases, can be straightforward. You are simply outlining who should inherit your estate when you pass away, and if your assets are not complicated, this document can be reasonably simple.
In your Will, you can set out who should take care of your children, who should inherit certain assets or property, who should run your business and any other property-related matters. You can also name the individuals you wish to be responsible for distributing your estate, known as executors. Estate planning is a more extensive process and may include several documents to protect you, your property, and your family in the event of loss of capacity and your death.
As discussed above, taking stock of all your assets, valuing your estate and making a Will is an important part of the estate planning process.
A Power of Attorney grants another person the power to make certain decisions on your behalf in the event that you lose the mental capacity to do so yourself. There are three types of Power of Attorney:. Continuing Power of Attorney - this allows the person you appoint as your attorney to make decisions concerning your financial affairs and property assets. Welfare Power of Attorney - this can only be used where you no longer have mental capacity and allows the person you appoint as your attorney to make decisions concerning things such as medical care and where you live or receive treatment.
Combined Power of Attorney - this allows the person you appoint as your attorney to make decisions concerning both your financial affairs and your health and welfare. A trustee will be named in the document to control the assets' distribution following the trustor's wishes, following the trust document and its mandates. This is also an effective way to control the passing of your estate beyond the grave.
To be valid, a trust must identify the following: the trustor, the trustee, the successor trustee, and the trust beneficiaries. A declaration of trust will also provide the basic terms of the trust.
Your estate stays private and passes directly to your heirs, you do not pay a probate attorney or court costs, and your loved ones may be able to avoid being tied up in probate court for what could be a year or more. One stop you should try to avoid on the estate-transfer train is probate court. This is where your heirs could spend months sorting out your estate if your transfer plans are not efficiently laid out.
Probate court is the judicial system section responsible for settling wills, trusts, conservatorships, and guardianships. After death, this court might examine your testamentary will, which is a legal document used to transfer your estate, appoint guardians for minor children, select will executors, and sometimes set up trusts for your survivors.
Your executor would still be responsible for sorting out the estate, which could take six to 18 months, depending on the intricacies. Imagine your eldest child spending the next year and a half traveling back and forth to court hearings when they should be mourning your passing.
Wills and trusts are both important estate-planning tools, but they differ in important ways. First, a trust is activated when the grantor signs it. A will does not go into effect until the testator. Upon your death, your will goes through probate, and a trust does not. A will is where you name guardianship of any minor children, plus share any funeral or memorial plans or requests. A trust will streamline the process of transferring an estate after you die while avoiding a lengthy and potentially costly period of probate.
However, if you have minor children, creating a will that names a guardian is critical to protecting both the minors and any inheritance. Deciding between a will or a trust is a personal choice, and some experts recommend having both. A will is typically less expensive and easier to set up than a trust, an expensive and often complex legal document. Nearly everyone should have a will, but not everyone likely needs a living or irrevocable trust. If you have property and assets to place in a trust and have minor children, having both estate-planning vehicles might make sense.
A will and a living trust are two separate legal documents. One doesn't usually trump another, but if the issue arises, a living trust will most likely override a will because a trust is its own entity. The cost to set up a trust depends on various factors, including the type of trust, the state you live in, and how complex the legal document is. It is important to settle your affairs earlier rather than later in life. A will or a trust, or both, can ensure your assets and possessions end up where you want them to go.
If you have minor children, you should absolutely make a will to name guardianship. A trust will streamline your estate's transfer, unlike a will, which goes through probate. Making an estate plan a priority now can save money and precious time later, and help your loved ones avoid potential financial hardship. Internal Revenue Service.
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These choices will be signaled globally to our partners and will not affect browsing data. We and our partners process data to: Actively scan device characteristics for identification. I Accept Show Purposes. It is never too late to contact an attorney for the planning of your estate. You can get expert professional help regarding your estate by contacting Chicago Estate Lawyer. When you need to find an estate planning lawyer in Chicago, it can be a frustrating experience. However, ChicagoEstateLawyer.
View full business profile here: Chicago Estate Planning Lawyer. Member Login Get Listed Today. Wills Trusts Estate Plan Chicago. The information provided on this website is not legal advice, this website is not a lawyer referral service, and no attorney-client or confidential relationship is or should be formed by use of the site. Toggle navigation Toggle Search. November 21, The other documents that comprise an estate plan include: Durable power of attorney, which allows an agent to handle your finances Healthcare power of attorney, which allows a named agent to make medical decisions on your behalf if you are incapacitated Advanced directive, which details your decision about life-prolonging treatment.
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