When it comes to estate planning, many may assume that wills and trusts are synonymous. They are, however, quite different, and each one may benefit you in unique ways.
Below, we provide answers to common questions about wills and trusts.
#1. What is the Difference Between a Will and a Trust?
While both wills and trusts are helpful tools in creating a well-executed estate plan, they each have their own unique benefits.
A will is a legal document that outlines your wishes regarding asset and property distribution upon your death. A trust, on the other hand, can begin distributing assets and property before your death. With a trust, a "trustee" holds assets for another person, called a "beneficiary." Beneficiaries may receive these assets before or after the trustee’s death.
#2. Can Only Older Adults Make a Will or a Trust?
No! People of any age can begin the estate planning process. In fact, it’s smart to do so as soon as possible so that, if you become incapacitated, your wishes are carried out as you intended.
#3. What Happens if You Pass Away Without a Will or a Trust?
If you pass away without a will or a trust, you are said to have died “intestate.” This means that your state’s succession laws will determine how your assets and property are divided, rather than by your loved ones.
Some of Utah’s intestate succession laws include:
If you have a spouse and no children, or your children are shared with your surviving spouse, your surviving spouse will inherit everything.
If you have children but no spouse, your children will inherit everything.
If you have parents but no spouse or descendants, your parents will inherit everything.
If you have siblings but no descendants or parents, your siblings will inherit everything.
Intestate succession laws illustrate why it’s important to begin the estate planning process as soon as possible so that your wishes are carried out appropriately. At Pearson Butler, our team can help you execute an estate plan that is suitable for your unique needs and family situation.
Contact Pearson Butler at (800) 265-2314 to schedule a consultation.