When you think about estate planning, it can seem like the entire endeavor revolves around stating your wishes about the way that you want your assets to be distributed. This is certainly at the core, but you should also consider the administration process that will be initiated after your passing.
Yes, you want to get assets into the hands of your loved ones in accordance with your wishes. At the same time, the way that this is done can vary depending on the choices that you make during the planning stage.
If you use a last will as your asset transfer vehicle, you would name an executor or personal representative in the document to act as the administrator. This can be someone that you know and trust, and there are also professional fiduciaries that can be engaged.
One of the first tasks for the executor will be to identify and inventory the assets so they can be prepared for distribution to the heirs. Since it is a decentralized scenario in most instances, it is not always easy for the executor to get a full understanding of all the property that is involved.
There is also the matter of many different ownership documents and multiple financial accounts. All of this can be done, and people have been doing it for generations, but it is quite inefficient.
Another aspect of this process that is less than ideal is the time consumption. Even if the executor was to get all of their ducks in a row in just a few weeks, the waiting game would continue. Probate will take close to a year to run its course in most cases, and the inheritors get nothing until the estate has been probated and closed by the court.
A Viable Alternative
A living trust is a great alternative that you can turn to if you would like to make sure that your estate administrator can complete his or her tasks effectively and efficiently.
If you use a living trust, you could act as the trustee and the beneficiary while you are alive and well. There is no loss of control in any way, because you have the power of revocation, and you call all the shots.
Plus, you have absolute flexibility, because you can change the original terms of the trust at any time, and you can convey additional property into it quite easily. To account for the administration after you are gone, you name a successor trustee, and your heirs would be the successor beneficiaries.
The first positive difference between a living trust that a will is the fact that the administration is not subject to probate. As a result, the pitfalls that we touched upon above are avoided.
When the trustee begins to administer the estate, all the property will have been signed over to the trust, so there is no need for a complex and time-consuming search.
To account for any property that may be in your personal possession at the time of your death, you can add a legal document called a pour-over will. This type of will would allow the trust to absorb assets that were never conveyed into it while you were alive.
Attend a Free Webinar
We have adjusted accordingly in light of the challenges that have been presented by the novel coronavirus. In lieu of our in-person group information sessions, we are now offering webinars that provide the same type of information in a safe but equally effective manner.
There is no charge to attend these webinars, but we do ask that you register in advance. You can visit our webinar page to check out the schedule and obtain registration details.
Schedule a Consultation!
Our doors are open if you are ready to discuss your estate planning objectives with a licensed attorney. If you would like to speak with us in person, you can rest assured that the office environment is as safe is it could possibly be, but we are also offering remote consultations.
You can send us a message to request an appointment, and we can be reached by phone at 310-337-7696.