A will is the cornerstone of most estate plans. It is a document that outlines where assets go after an individual passes away. It may also name a legal guardian for a minor child. Trusts name a trustee and are used to hold assets on behalf of beneficiaries. There are several factors that may determine whether an individual needs a trust.
Those who value their privacy may wish to put assets into a trust. Assets inside of a trust generally don’t have to go through probate, which means there is no public record. Assets such as a bank account, a retirement account or a life insurance policy are generally payable on demand and don’t need to go through probate anyway.
Individuals who want greater control over where their assets go may also want to put them into a trust. Trusts may contain customized language that a trustee must abide by when distributing an asset to a beneficiary. For instance, a parent could pass a portion of an inheritance to a child when he or she turns 20 and the rest when he or she turns 40. Those who own property in multiple states may avoid probate by putting it in a trust.
The primary reason people in New York are choosing to place their assets into a trust is to avoid the probate. Trusts are not subject to the probate process. Because of this, typically there is no delay in administering a trust, distributions can be made in a timely manner, and there are no probate fees.
Having wills or trusts as part of an estate plan may make it easier to avoid family disputes after an individual passes on. It is worthwhile to talk to an attorney about creating an estate plan or reviewing a plan that has already been created. If necessary, a lawyer can also assist with creating or altering plan documents in a manner that conforms with New York law.