If you’re thinking about your estate planning and want to ensure that your assets are protected and distributed according to your wishes after you pass away, you may want to consider a trust Will.
This blog will cover the basics of trust Wills, including how they work, the differences between trust and traditional Wills, and the benefits of setting up a trust Will as part of your estate planning. We’ll also provide some handy tips and considerations to keep in mind.
How a Trust Will Can Protect Your Assets and Loved Ones
Trusts are legal structures that everyone can make use of when estate planning. A trust Will, also known as a testamentary trust Will, allows you to set up a trust for your beneficiaries after you pass away. This trust can be used to manage and distribute your assets according to your wishes, providing added protection and benefits for your loved ones.
A common misconception is that you must be supremely wealthy to use them, but this is not the case! Regardless of your circumstances, one of the main benefits of a trust Will is that it can help protect your assets and give you greater control over how they are distributed after you pass away. For example, if you have young children, a trust Will can be used to manage their inheritance until they reach a certain age.
A trust Will can also protect your assets from creditors or other potential claimants. Additionally, it can provide added privacy and confidentiality, as the terms of the trust are not made public like a traditional Will.
The Differences Between a Trust Will and a Traditional Will
While both trust Wills and traditional Wills allow you to specify how you want your assets to be distributed after you pass away, there are some key differences between the two. A traditional Will goes into effect after you pass away, and your assets are typically distributed to your beneficiaries through the probate process.
Conversely, a trust Will takes effect immediately upon your death and allows you to set up a trust to manage and distribute your assets. Additionally, a trust Will can offer added protection and benefits for your loved ones, such as managing inheritance for minors or providing for a loved one with special needs.
Property Trust Wills
Also known as property protection trusts, property trust Wills provide greater peace of mind if you want to protect the value of your home. This form of trust holds your home or your share of your home, and you can grant someone (such as your spouse, partner, or child) the right to benefit from the trust during their lifetime, so they can continue to live in your property.
A property trust Will guarantees your chosen beneficiaries benefit from your share of the home if your surviving spouse remarries or creates a new Will. Therefore, you can leave more to your loved ones without fear that they will be accidentally excluded.
The Benefits of Setting Up a Trust Will
There are several benefits to setting up a trust Will as part of your estate planning, including:
- Probate – A trust Will can help avoid probate, which can be time-consuming and costly, meaning your loved ones can inherit your estate quickly and painlessly!
- Asset Management – Trust Wills can make it easier for your loved ones to manage your assets after you pass away, as the trust can be managed by a trustee who is responsible for carrying out your wishes.
- Care Fees – If you need care in the future, depending on your assets, you could pay 100% of the fees without assistance. As these fees are so high, people can be forced to sell their homes and leave a lot less to their loved ones after they pass away. However, a trust Will can protect your home and leave you more of your estate to pass on to your loved ones.
- Sideways Disinheritance – With life expectancy increasing, there is a chance that if you pass away first, your spouse may remarry. If they do not create a new Will, any children from your relationship may not receive anything, as the rules of intestacy dictate that the majority of their estate will go to their new spouse. A trust Will protects the assets you want to leave to your children regardless of remarriage, so you can rest assured that they will receive everything you want them to.
Creating a Trust Will: Tips and Considerations to Keep in Mind
If you’re considering creating a trust Will, there are a few essential things to keep in mind:
- It’s important to work with an experienced Will writer to ensure that your trust Will is appropriately drafted and meets all legal requirements.
- You need to decide on a trustee to manage the trust and consider whether you want to set it up to last for a fixed period or permanently.
- Carefully consider how you want your assets to be distributed, to whom, and any special provisions or protections you want to include.
Trust Wills can be an effective tool for estate planning, providing added protection and benefits for your loved ones and allowing you to specify how you want your assets to be distributed after you pass away.
If you’re considering setting up a trust Will as part of your estate planning, it’s important to carefully think about your goals and priorities and make sure it reflects your wishes clearly and concisely. For help and friendly legal advice, get in touch with The Planning Bee today. Our team of experts is here to help you get the most out of your Will.