Article 5-Estate Planning Series: The Law You Need to Know Before Signing a Will or Trust

Written by Wright Law on . Posted in Uncategorized

Last column I explained how people can inadvertently give up control of what they spent a lifetime building.  These mistakes occur when people don’t understand what their Will or trust can do (or not do), or make decisions based on misinformation.  Understanding some fundamental legal concepts will help you maintain control of your estate with a cohesive, comprehensive plan.

Most people understand the basic purpose of a Will.  It is the document most people use to instruct who will receive their assets when they die.  A Will may be sufficient to address the assets that make up the estate of many people.  (However, as we discussed in week one, a Will alone is not sufficient to address all the issues that should be considered as part of an estate plan). 

To know if a Will is the appropriate document for you, it is important to understand what a Will cannot do.  A Will does not allow you to control how your assets may be used after your passing. Also, a Will does not allow you to control how your assets are used while you are still alive, but incapacitated by a stroke, a fall, dementia or other reasons.  A trust is necessary to maintain that type of control    

So what is a trust?  A trust is like the wagon you pulled as a child.  The beauty of a wagon was that it helped you carry more than you could carry yourself, while still maintaining control over those things.  You could pull the wagon along, and when you run off to play, the things in your wagon remained yours and in your control.

Placing items in a trust is like placing them in a wagon.  You maintain control over those items because you maintain control over the trust. 

Furthering the wagon analogy, at your passing, the only thing that changes is that you are no longer there to pull the wagon.  However, because your things stay safely in the wagon, the person you designated as your successor trustee picks up the wagon handle and continues pulling it -- following the instructions you have left.  The things in that wagon remain yours, even after you are gone.

Over the next few columns, we will discuss why, or why not, you might need a trust.

© 2015 Steven J Wright  

Wright Law Offices, PLLC

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