Estate planning is one of the most important steps you can take to ensure that your assets are distributed according to your wishes. However, many people are unsure whether they should create a will, establish a trust, or both. Understanding the differences between these estate planning tools is crucial to making an informed decision. As experienced New York City estate planning attorneys, the team at Gordon & Gordon is here to guide you through the process and help you choose the best option for your unique situation.
What Is a Will?
A will is a legal document that outlines how you want your assets to be distributed after your passing. It allows you to name beneficiaries, designate guardians for minor children, and specify your final wishes. Wills are relatively straightforward and can be an effective tool for individuals with simpler estate planning needs.
Key Benefits of a Will
One of the primary benefits of a will is its simplicity. Creating a will is typically quicker and less expensive than setting up a trust. A properly executed will is legally binding in New York, ensuring that your wishes are honored. Additionally, if you have minor children, a will allows you to name a guardian to take care of them if something happens to you.
The Probate Process
One important aspect of wills to consider is that they must go through probate—the legal process of validating a will and administering the estate. This process can take several months to over a year, depending on the complexity of the estate and whether any disputes arise. Our firm has extensive experience handling probate matters, and our New York probate attorneys can help navigate this process efficiently.
What Is a Trust?
A trust is a legal arrangement where a trustee holds and manages assets on behalf of beneficiaries. Unlike a will, a trust can take effect while you are still alive, allowing for greater control over your assets.
Types of Trusts
There are different types of trusts, including revocable and irrevocable trusts. A revocable trust allows you to retain control of your assets during your lifetime and can be modified or revoked as needed. An irrevocable trust, on the other hand, cannot be changed once it is established, but it offers benefits such as asset protection and potential tax advantages.
Key Benefits of a Trust
One of the most significant advantages of a trust is that it allows you to avoid probate, which means your assets can be distributed to beneficiaries more quickly and without court involvement. Trusts also offer privacy, as they do not become public record like wills do. Additionally, a trust provides greater control over how and when your beneficiaries receive their inheritance. This can be particularly useful if you have minor children, special needs beneficiaries, or want to protect assets from mismanagement.
Key Differences Between Wills and Trusts
While both wills and trusts serve to distribute your assets, there are important distinctions between them. One key difference is that a will must go through probate, whereas a properly structured trust allows your estate to bypass this often lengthy and costly process. Privacy is another factor to consider—a will becomes a public record during probate, while a trust remains private.
Additionally, wills take effect only after death, whereas trusts can be used during your lifetime to manage assets. When it comes to cost and complexity, wills are generally simpler and less expensive to create, while trusts require more time and effort to set up but offer long-term benefits such as avoiding probate and providing greater control over asset distribution.
Which One Is Right for You?
The right choice depends on your financial situation, estate size, and personal preferences.
When a Will Is the Best Option
A will may be sufficient if you have a relatively simple estate and do not mind the probate process. It is also the best choice if you need to designate guardians for minor children and want a straightforward, cost-effective estate plan.
When a Trust Is the Better Choice
A trust is often the better option if you want to avoid probate, especially if you have significant assets or own property in multiple states. It is also ideal if you prefer to keep your estate matters private or want to control how and when assets are distributed to beneficiaries.
Using Both a Will and a Trust
For many individuals, the ideal estate plan includes both a will and a trust. A pour-over will can ensure that any assets not included in the trust are still covered. Consulting with an estate planning attorney in New York can help you determine the best combination for your needs.
Consulting an Estate Planning Attorney
Choosing between a will and a trust is a significant decision, and professional guidance is essential to ensuring that your estate plan is properly structured. Our New York City estate planning attorneys at Gordon & Gordon specialize in crafting personalized estate plans that align with your financial and personal goals.
We also understand that many families face challenges during probate. If your loved one’s estate is in probate, our experienced New York probate attorneys can provide the legal support needed to navigate this process smoothly.
Estate planning is not just for the wealthy—it is an essential step for anyone who wants to ensure their assets are handled according to their wishes. Whether you need a will, a trust, or a combination of both, our attorneys at Gordon & Gordon are here to help. Contact us today to schedule a consultation and take the first step toward securing your family’s future.