Creating a strong legal and financial plan for the future involves thinking carefully about the long-term implications of your decisions. A choice that makes sense now for your current estate plan may not be effective or practical when it is time to settle your estate in the future. This is why it is essential for anyone who is creating an estate plan to think carefully about how to create a strategy that will make the most sense years into the future.
The building block of any estate plan is a will. This is a document that outlines your preferences for how you want your property distributed after your passing, and it can also nominate a guardian for your minor children. However, there are other estate planning tools available to you that can provide you the opportunity to truly shield your interests and allow you to control your assets.
A will versus a trust
As you are creating your estate plan, you may be wondering which estate planning tools are important for your individual situation. For example, you know you need a will, but do you know what you should include in your will? In addition to a will, you may benefit from other estate planning tools, including a trust. A trust is a legal way for you to set aside and protect assets for a specific use, including the care of a loved one or charitable giving. You may find the following facts about trusts helpful:
- In the creation of your trust, you can outline terms for how you want the assets held in the trust managed and distributed.
- Trusts become effective at the time assets transfer into them, allowing you to enjoy immediate benefits.
- There are a variety of different types of trusts, and the most appropriate choice depends on your goals for your assets and the beneficiary of the trust.
If you are unsure of whether a trust could be a useful addition to your estate plan, you may benefit from an assessment of your case. This step provides you with the opportunity to understand the specific ways you can control what happens to your estate and provide for your loved ones after you pass away. The future is unpredictable, and you will benefit from learning about what estate planning steps you need to take as soon as possible.