So I Die Without a Trust? Who Cares?
The answer to this question is very simple: your family. I constantly find myself trying to explain to people that writing a will is only half the battle when it comes to planning your estate. The reason is complicated. When you write a will, it’s normal to think “okay, I got that taken care of. I know who’s getting my stuff”. This is true, but you may not realize that you’re still leaving your family with the expense, time, and anxiety of going through probate. Your will may say who gets what, but there is no automatic mechanism in that will that transfers the property. Let’s say you die leaving a house worth $100,000. You might say in your will that you want that house to go to your nephew when you die. However, simply saying this in a will doesn’t make it so. The title on your house doesn’t suddenly change due to your death. The only way that happens is by going through probate. Probate costs money. More money than writing a trust would cost. There’s a lot of time involved, a lot of paperwork to be filed, and during the probate, no one can touch any of the property. Probates often take six or more months. During the probate, the judge will read the will and he authorizes the legal transfer of the house and any other property. They will just tell the judge what to do, but it doesn’t do away with him.
This is where a trust comes in. As stated earlier, trusts are generally a lot less expensive than a probate. You can put your house and other assets into a trust during your lifetime. What this essentially means is that you can transfer your house and other assets from yourself and to the trustee of your trust. Then, when you pass away, the trustee simply transfers the house and any other property by moving it from him/herself as trustee, to the rightful heir, as stated elsewhere in the trust. No judge involved. No time. Little effort. Huge savings. It will save your family a lot of anguish and money. A will comes along with a trust. This kind of will is known as a pour-over will. In the event you forget to transfer something to your trust during your life, the will will cover you. Of course, like a will, it will, of course, have to be probated if it becomes necessary to do so.
I always try to get my clients to write a trust. If you do, believe me, your family will thank you.
For more on wills and trusts, see our probate page.