When most people hear the term "estate planning," they automatically think of a will. For people of modest means with few assets to pass along, few heirs to leave them to or few restrictions on how funds are spent afterwards, a will and testament may be all they need to accomplish their estate planning goals.
When the estate itself is more complicated, there are concerns regarding the possibility for long-term medical care, the protection of assets for the future is key, or there are specific guidelines for how your property should be meted out, a will might not be sufficient. In those cases, it could be better to put assets into an irrevocable trust instead.
Understanding the differences
Wills, for the most part, have to go through the probate process in order to effectively pass title to property. Probate is a legal proceeding, in which the assets of the estate could be made public. There are also limits on the authority that wills have over estate property. A will could, for example, dictate that your granddaughter needs to spend a hour a week volunteering at an animal shelter in order to inherit your family china. Unless the executor of your estate brings a legal action to compel this, however, there isn't really a mechanism to ensure that your wishes are met.
Wills certainly have their benefits, particularly when setting out terms for preferred guardians of your minor children, the disposition of your remains and your funeral or memorial arrangement preferences. For more complex assets, though, irrevocable trusts offer not only protection from public view, but the ability to avoid probate, an automatic title transfer, and the ability to have asset disposition monitored by an impartial trustee if you so choose.
How do you know if a will, irrevocable trust or some other estate planning mechanism is best for you? By sitting down and having a face-to-face discussion with your estate planning attorney, preferably one who is board-certified in estate planning and probate law by the Texas Board of Legal Specialization.
Morbid as it may be to think about, we are all going to die at some point. As many as 60 percent of us haven't yet established formal estate plans to dispose of our assets after we are gone, leaving our loved ones and heirs at the mercy of state intestacy laws, and potentially leaving them on the hook for taxes, bills and other expenses because of it. Don't delay any longer. Contact a Texas estate planning attorney today to get started protecting your assets.