WILLS OR TRUSTS – WHICH WORKS FOR YOU?
A common question that people have when beginning to plan for their future is, “Should I make a Will, or should I make a Trust?” Many people ask this question but might not know which one is better. The answer to that question is a lawyer’s favorite answer, “It depends!”
In In Tennessee, both wills and trusts serve as tools for preserving your property
In Tennessee, both wills and trusts serve as tools for estate planning. Still, they have distinct benefits and disadvantages, depending on the specific circumstances of each case and the individual's goals for their estate.
A Will takes effect only upon death
A will is a legal document that takes effect upon the death of the person who created it and controls how their property is handed out. This collection of property, money, and other belongings is referred to as an “estate.” One advantage of a will is that it allows for court supervision during the estate distribution process (called “probate”), which provides a Judge or Clerk & Master to work as a “referee” to resolve any problems or issues among people who may or may not be able to receive property from the estate. Additionally, the probate process that a Will gives you access to can cut off potential claims against the estate, as those who are owed money are given a limited timeframe to file claims for that money. The probate process that Wills gives you access to also provides access to the family allowance, which allows a spouse to take money from the estate for one year after the other spouse dies to uphold the standards of living. Look at Tennessee Code Annotated 30-2-102 for more information.
This is available in probate but does not apply to trusts. However, the probate process can be time-consuming, is public, and may involve unpredictable court fees, which can be a disadvantage for some individuals. Lastly, a will ensures that your property goes exactly where you want it. The Court in the probate process has many safeguards that will make sure that the terms that you write are strictly followed.
A trust, on the other hand, can offer the benefit of avoiding probate, which can result in quicker distribution of property, give greater privacy, and potentially lower costs. Trusts are formed either during someone’s life as a separate document or can be created in a Will for the best of both worlds. Trusts are particularly advantageous for individuals with property in multiple states, as they avoid the need for multiple probate cases to be opened in each jurisdiction. However, trusts do not provide the same protections as probate against people who are owed money, and creditors may have a longer time to file paperwork that challenges the distribution of trust assets and take a case to court to get money from the trust. Additionally, a trust cannot appoint a guardian for minor children, which is a function that must be addressed in a will. Trusts also require careful drafting to avoid disputes, as they are less formal than wills and may be more susceptible to challenges.
A Will is typically cheaper and easier to create initially.
The process usually involves sitting down with an attorney to decide who gets what. Wills allow you to appoint guardians for your children. A Trust only allows you to provide for someone after you are gone and does not give the option to appoint anyone to ensure your children are taken care of.
Ultimately, the choice between a will and a trust depends on the individual's specific needs. Some cases require more privacy than others. Some cases may involve a complicated set of facts that require detailed and tailored explanations for the exact situations at hand. Some cases need to be protected from people who are trying to get money unfairly, and sometimes you might not want specific property to have to be sold to pay someone that you owe fairly. Both Wills and Trusts are tools that can be fitted to each particular, personal scenario. Contact us at Held Law and, ask for Jonathan Baumgartner to talk it over with you. Our consultations are secure and confidential in the Knox, Blount, Sevier, Monroe, Roane, Loudon, Jefferson, and surrounding areas.
