Do I Need a Will or Trust?

Wills

A will is a document where its creator, called the “testator,” will designate who receives his or her property upon his death. A will has the benefit of being relatively simple and inexpensive to create. A formal will needs to be witnessed by at least two witnesses in order to be valid in California. Here at Griswold LaSalle, we work closely with the client throughout the whole process of the will creation, including the creation of multiple drafts if necessary to make sure the will says exactly what the client wants. However, a holographic (handwritten) will only need to be handwritten, show the intent to give property at the death of its creator, and be signed by its creator in order to also be considered a valid will. In sum, a will may or may not need an attorney and can be created by anyone. However, beyond a simple will, our firm will create an entire estate plan reflecting the client’s wishes and needs. Our estate plans include a financial power of attorney and a health care power of attorney in addition to the will.

The financial power of attorney we create for you will allow our clients to designate a person or persons to act as their agent in financial matters. This means that our clients can feel secure in knowing that should an accident occur, or they are out of the country and an emergency happens, someone, they trust will be able to access and manage their finances.

Likewise, our health care power of attorney will allow our clients to designate a person or persons to act as their agent in regard to their health care. This means that should they be unconscious or incapacitated as a result of an accident or emergency, someone they trust can make the right decision in regards to their medical needs.

The downside of using a will, as opposed to a trust, is that it must be probated. Probate is the court process by which the estate of the deceased is distributed to their beneficiaries or heirs as designated by the law. Because the probate process involves the court, it is both expensive and time-consuming. An attorney is necessary to navigate the probate process because of the different statutory requirements at each stage of the process. Our firm has extensive experience and knowledge in regards to navigating the probate process, including will contests. Failing to meet the statutory requirements can delay and/or increase the cost of the probate and our firm makes sure that does not happen to our clients. In our experience, the probate of a will takes about a year.

Finally, because the judgment in a probate process is public record, the listed assets of the deceased are available to the public. A will and estate plan generally cost about $1,000.00 to create, and a week or two to prepare.

 

Trusts

A living trust is a document where its creator, the trustor, will designate the property belonging to the trust, the persons or person who will take over after the creator’s death, and beneficiaries. A trust is flexible in that powers or property distribution can be exactly as the trust creator wants them to be. Our firm uses its practice history and experience to make sure our client’s living trust will accurately reflect their wishes and needs. In addition, unlike a will, a living trust will completely avoid probate on the death of its creator and thus avoid court costs and wasted time.

As attorneys, we make sure that language used in the trust will create a proper living trust for the client’s individual estate planning purposes. If the wrong language is used, then the trust may not be considered a living trust and a probate will be required, or the distribution may not proceed in the manner that the trust creator wished it to. Our firm makes sure that not only does the client’s trust reflect their wishes, but that it is a legally valid and serviceable document. In addition to the living trust itself, our firm creates an entire estate plan centered around the trust and includes a financial power of attorney and a health care power of attorney.

A financial power of attorney allows our clients to designate a person or persons to act as their agent in financial matters. This means that our clients can feel secure in knowing that should an accident occur, or they are out of the country and an emergency happens, someone, they trust will be able to access and manage their finances.

A health care power of attorney allows our clients to designate a person or persons to act as their agent in regard to their health care, so should they be unconscious or incapacitated as a result of an accident or emergency, someone they trust can make the right decision in regards to their medical needs.

A trust avoids probate by re-titling all of the creator’s property into the name of the trust while its creator is alive. During the creation of the trust, our estate planning team will make an inventory of the client’s property and will make sure that all of it is re-titled and/or allocated correctly. This means that upon the creator’s death, they have no estate and their trust will be administered by a designated person, known as a successor trustee, who must follow the directions in the trust.

Our firm also takes federal estate tax law into account in the creation of our clients’ living trust documents. This is especially applicable to married couples who own large tracts of land. Our team can analyze our clients’ needs and craft their trust documents so that upon their death, their trust will pay as little as possible in estate taxes. This preserves our clients’ assets for their intended recipients.

The downside of a trust is that the initial costs can be expensive. A trust can be expensive because of the inventory of the creator’s assets and any re-titling involved in any real property owned by the trust creator. A title must be current and in the name of the trust at the date of the trust creator’s death in order to avoid unnecessary complications or costs. A trust generally costs double the amount of a Will due to the additional complexities.

As always, no two people are alike, so your individual needs will vary, but our job is to ensure our client’s wishes are carried out and give them guidance as to whether a will or trust would be better suited for their individual needs.