Estate planning is all about making necessary plans in preparation of one’s death. This plans re usually made with the aid of some important documents which are widely regarded as estate planning documents. Documents like a will, a power of attorney, and a trust are some important estate planning documents created during estate planning.
In this article, we’ll be taking a look at some of these documents including facts about the probate process.
What is a Trust?
A trust is a legal entity created by an individual (grantor) to manage or control his assets after his death or while he is still alive. When creating a trust, which can also be regarded as a legal vehicle used in transferring wealth, a grantor selects a trustee.
It is the job of the trustee to ensure that the law of the trust is adhered to, it is also the job of this individual to ensure that the assets in the trust is well managed according to the wish of the grantor.
Trusts are usually created during one’s lifetime to ensure that assets present in the trust are managed and distributed based on the individual’s wish. Sometimes wealthy individuals create a trust rather than a will when planning their estate. In the trust, they outline how they want their assets to be managed and distributed after their death.
There are three important individuals involved in a trust:
The trustee: The individual charged with managing the assets in a trust
The grantor: This is the owner of the trust. The job of the grantor is to create a trust and select a trustee for the trust.
What is a Will?
A will is another important estate planning document. A will is a document that contains the wishes of an estate owner regarding how he wants his assets to be distributed. A will also contains the name of beneficiaries, and the name of the executor.
In addition, a will consist of the assets of the decedent and how he wants them to be shared. Sometimes a will may contain details regarding the burial of the decedent. A trust can be used instead of a will, there are many rich folks out there who create a trust rather than a will. Contact an estate planning attorney for advice on how to create a will.
What is Probate?
Probate is a legal process done to determine if a will is genuine or not. This process which usually kick off after the death of the testator is often handled by the estate executor. If an estate executor wasn’t named, it is the duty of the court to name one.
People are often scared of probate due to how difficult, time-consuming n and expensive it can be. A competent estate planning lawyer will advise his or her client to plan an estate that avoids this painstaking process.
If you are named as the executor of an estate that is on the verge of undergoing probate, you will need the help of a probate attorney to sail through the process.
Probate usually involves paying all outstanding debts and taxes of the deceased, inventorying the decedent assets, and distributing the assets to rightful beneficiaries.
Probate Facts
Probate is a hell of a process for not just executors but probate lawyers, and the beneficiaries. Here are some facts about this process:
- Probate can be expensive and time-consuming
One major reason why people try to avoid probate is because of the expenses and stress associated with the process. Probate takes time and it can cost you lots of money.
- Probate is not for all assets
Assets placed in a trust is usually free from probate. So if you wish to avoid this process, place your assets in a trust.
- Probate is public
The probate process is usually done in the probate court which is usually open to the public.
- Probate can be prevented
There are a few ways to prevent this expensive and time-consuming process. One of such ways is by creating a trust.