If you are thinking about matters like wills and trusts and the distribution of assets after you die, perhaps it is time to ask the advice of an attorney experienced with estate matters. Probate is usually a straightforward process in which a judge reviews the validity of your will and your wishes as to the distribution of property and assets, but it does have some drawbacks. If you are leaning toward setting up a trust, your main reason may be to avoid probate altogether, but trusts have other advantages.
Probate may be a good idea
If you keep your will up-to-date, probate should be a fairly smooth process. Once the judge confirms that your will is indeed yours, your assets and property will be distributed according to your instructions. The process, however, can be both lengthy and expensive. Assets that go through probate are those that are in your name alone. For example, a home jointly owned by you and your spouse will not be probated; it becomes the sole property of whoever lives longest.
A trust is a more complicated undertaking
You can avoid probate altogether if you put your property and assets into a trust where they will be held for your beneficiaries. A trustee maintains control and will help with distribution after your death. There are different kinds of trusts and benefits. In the case of a children's trust, for example, a grantor can make tax-free monetary gifts to children or grandchildren out of the trust funds, which reduces the estate taxes that are to be paid. If you set up a revocable living trust, the trustee you select can step in and manage your affairs if you should be unable to do so. This can give you peace of mind if you should become ill or disabled. Revocable living trusts will not protect your assets from those who have legal claims against you, however. Although this is a legal entity, you are still regarded as the owner of the trust's assets. If you want to shield them from creditors, you might consider setting up an irrevocable trust, a legal entity you can neither control nor revoke.
Weighing one against the other
In most instances, the probate process, although slow, goes along smoothly without conflict or problems caused by contesting parties. Much of what happens is clerical in nature and the only issue of consequence is that heirs may have to wait months before the distribution of assets takes place. If you choose to set up a revocable living trust, you will be able to avoid probate and the distribution of assets can be done much faster. An experienced attorney can go over the various pros and cons with you and help you decide which option is best for your particular circumstances.