One of the most common questions we hear from clients is whether they need a will, a trust, or both. The honest answer is that it depends on your situation. There is no universal right answer, but understanding how each document works can help you have a more informed conversation with a Dallas, TX estate planning lawyer about what makes sense for you.
What a Will Does
A will is a legal document that says how you want your assets distributed after you die. It can also name a guardian for minor children, designate an executor to manage your estate, and address personal property. A will only takes effect at death, and it must go through probate before your wishes can be carried out.
Probate in Texas is not always the lengthy ordeal people imagine, but it does take time, involves court filings, and is a matter of public record. For many families, that is a perfectly acceptable process. A well-drafted will is a solid foundation for an estate plan, and for plenty of people, it is all they need.
What a Trust Does
A trust is a legal arrangement in which you transfer assets to the trust to be managed according to its terms. A revocable living trust, which is the most common type used in estate planning, allows you to remain in control of your assets during your lifetime while providing a way to transfer them at death without going through probate.
Trusts offer a few things a will cannot:
- Probate avoidance. Assets held in a properly funded trust pass directly to beneficiaries outside of court.
- Incapacity planning. A trust can address what happens to your assets if you become unable to manage them yourself, not just after you die.
- Control over distributions. A trust can specify conditions for how and when beneficiaries receive assets, which is particularly useful if you have minor children or a beneficiary who is not ready to manage a large inheritance.
- Privacy. Unlike a will, a trust does not become part of the public record.
So Which One Do You Need?
For some people, a will is the right tool. For others, a trust provides meaningful advantages. And for many, the best plan includes both: a trust to hold major assets and avoid probate, paired with a “pour-over” will that captures anything not already transferred into the trust.
A few circumstances where a trust is often worth considering:
- You own real estate in more than one state
- You have minor children or a beneficiary with special needs
- You want to minimize your family’s involvement with the courts
- You have a blended family or a non-traditional family structure
- Privacy matters to you
That said, a trust also requires more upfront work and must be properly funded to function as intended. An unfunded trust accomplishes very little.
The Right Plan Depends on Your Life
Estate planning is not a one-size-fits-all exercise. The right documents for you depend on your assets, your family, and what you want to happen when you are gone or unable to act. That is exactly the kind of analysis we do with clients every day as a Dallas, TX estate planning lawyer serving the Greater Dallas area.
If you are ready to figure out what your plan should look like, we would be glad to talk it through with you. Contact Ellen Williamson Law, PC to schedule a consultation and get a clear picture of your options.