When planning for the future, it’s essential to consider what will happen to your assets after you pass away.
This is where estate planning comes in, and two standard options for protecting your assets are online wills and trusts.
However, many people are confused about the difference between these two options. In this blog post, we’ll break down the differences between online wills and trusts so you can make an educated decision about your estate planning.
Introducing the Difference Between a Will and a Trust
Online wills and trusts are legal documents that allow you to plan for your future and protect your assets. However, they have some fundamental differences in how they work and what they offer.
A will is a document that outlines your wishes for how your assets will be distributed once you pass. A trust is a legal entity that holds and distributes your assets based on your wishes.
What is a Will and How Does It Work
A will is a document that allows you to specify how your assets are distributed after your passing. It names an executor responsible for carrying out your wishes and details who gets what from your estate.
A will only goes into effect after you pass away, and its instructions can be legally challenged in court. Wills can be updated regularly to reflect changing circumstances and new wishes.
Understanding the Advantages of Wills
One of the advantages of having a will is that it is a relatively simple and inexpensive document to create. You can work with a lawyer to draft a will that meets your needs or use an online service to create a basic will. A will also allows you to name guardians for your children and specify how your pets should be cared for after your death.
What is a Trust and How Does It Work
On the other hand, a trust is its own legal entity that holds your assets & distributes them according to your wishes. There are different types of trusts, but they all involve a trustee who manages the trust and distributes the assets to the beneficiaries. A trust can be established during your lifetime or after your death and remain in effect for many years.
Benefits of Setting Up a Trust
One of the benefits of setting up a trust is that it can help you to avoid probate. This is the court process that validates a will and distributes assets. Probate can be time-consuming and expensive, and it can delay the distribution of your assets to your beneficiaries. A trust can also provide more privacy than a will, as it is not a public document like a will is.
Differences Between Wills and Trusts to Consider
When deciding between a will and a trust, several differences exist. One is cost – a will is generally less expensive to create than a trust. Another is privacy – a trust is more private than a will.
A trust can also offer more protection for your assets, as it can be more difficult to challenge in court than a will can be. However, a trust also requires more effort to set up and maintain than a will, which may not be necessary for all individuals or families.
Understanding Online Wills And Trusts: In Closing
In conclusion, online wills and trusts are essential estate planning tools to help you protect your assets and plan for the future. Understanding these two options can help you decide what is best for your needs.
Whether you choose a will or a trust, working with a qualified estate planning lawyer or advisor is essential to ensure your wishes are carried out exactly as you envision. Thanks so much for reading.