Deciding between a will and a trust can be a critical decision for couples in any stage of life. This topic was recently discussed on the Get Ready for the Future Show, and our financial advisors are ready to help you figure out what would work well with your situation.
Let’s break down the key considerations for estate planning.
The Basics: Why Estate Planning Matters
Surprisingly, most Americans die without any estate plan at all. This means leaving critical financial decisions to the court system and potentially causing unnecessary stress for your loved ones. A basic estate plan is more than just deciding who gets grandma’s china—it’s about protecting your family’s financial future.
Will vs. Trust: What’s the Difference?
The Will: A Good Starting Point
A will is better than nothing, but it comes with significant limitations:
- It must go through probate, a court-supervised process
- Probate can be expensive, potentially costing 3-7% of your estate’s total value
- For a $2 million estate, probate could cost up to $140,000
- The process is time-consuming, often taking months before heirs can access assets
The Trust: A More Comprehensive Solution
A trust offers several advantages:
- Avoids the probate process entirely
- Provides more control over asset distribution
- Can protect assets from potential future challenges like divorce
- Allows for structured distribution to heirs (especially important for younger children)
Key Considerations for Your Situation
When deciding between a will and a trust, several important factors come into play. The composition of your assets—whether they’re primarily in real estate or retirement accounts—can significantly impact your estate planning strategy.
You’ll also want to carefully consider your children’s ages and their financial maturity. Some families prefer a trust because it allows for more controlled distribution of assets, preventing a sudden large windfall that might not be wisely managed. Your desire for asset protection and structured inheritance can guide you towards the most appropriate solution for your family’s unique circumstances.
Beyond Wills and Trusts: Additional Estate Planning Essentials
A comprehensive estate plan extends far beyond simple asset distribution. It should include critical documents that protect you and your family during unexpected circumstances.
A power of attorney for both financial and medical decisions ensures that someone you trust can make important choices if you become unable to do so. Healthcare directives provide clear guidance about your medical preferences, giving your loved ones peace of mind during potentially difficult times. Additionally, having contingency plans for potential incapacitation can help your family navigate complex situations with clarity and confidence.
Getting Started
Don’t be intimidated by the estate planning process. While it may seem complicated, GenWealth financial advisors are equipped to guide you through each step.
Now, through a partnership with Wealth.com, our financial advisors are ready to help you gather the necessary information and explain the various options available to you while creating a basic estate plan. This service to our clients gives you access to one of the leading planning portals for estate planning. The process is more manageable than most people imagine, and professional guidance can make it feel less overwhelming.
Take Action
Don’t let uncertainty prevent you from protecting your loved ones’ future. Remember, estate planning isn’t just about distributing assets—it’s about providing peace of mind for you and your family. Call one of our financial advisors today to get this process started.
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The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
