Essential estate planning documents to ensure final wishes are fulfilled
Two key documents in your estate plan are a trust and a will. In Massachusetts, there are several types of wills and trusts.
Wills
A Will, also known as a Last Will and Testament, is primarily designed to transfer your assets according to your wishes. A Will also typically names an Executor, the person you designate to carry out your instructions. If you have minor children, you should also name a Guardian and one or more alternate Guardians in case your first choice is unable or unwilling to serve. A Will only becomes effective upon your death and after it is admitted to probate by a probate court.
Common will types for estate planning include Basic Wills for straightforward asset distribution, Testamentary Trust Wills for managing assets for minors or beneficiaries named in the will, and Pour-Over Wills that work with a living trust to capture forgotten assets.
A Living Will informs others of your preferred medical treatment should you become permanently unconscious, terminally ill, or otherwise unable to make or communicate treatment decisions. In conjunction with other estate planning tools, it can provide peace of mind and security while avoiding unnecessary expense and delay in the event of future incapacity.
Trusts
An important tool in the estate planning process, a trust can be created in one of several ways.
There’s the Testamentary Trust, a trust created in your will that takes effect after your death. A trust that takes effect during your lifetime is a Living Trust.
A Living Trust is revocable, allowing you to change or cancel its provisions. To ensure the Living Trust functions properly, you should transfer many of your assets to it during your lifetime. You retain control of your assets, have them managed during incapacity, and efficiently and privately transfer them to your loved ones at death, in accordance with your wishes. Unlike a will, a trust usually becomes effective immediately upon incapacity or death. One of the great benefits of a properly drafted and funded Living Trust is that it will avoid or minimize the expense, delays, and publicity associated with probate.
With a Living Trust-based estate plan, you also need a Pour-Over Will. For those with minor children, the nomination of a guardian must be set forth in a will. The other major function of a Pour-Over Will is that it allows the executor to transfer any assets owned by the decedent into the decedent’s trust so that they are distributed according to its terms.
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