When it comes to estate planning, if you’re like many teachers we encounter, you’re not sure which is better, a will, or a trust. Let’s take a minute to dive into the important details.
A will is a document that allows you to determine how your affairs will be handled when, should you pass away. Wills go through a process called probate, which is a court validating your instructions for critical items like who to distribute your assets and belongings to and who will be guardian for your children. However, these instructions may be challenged during the probate process, which is public, and once completed, there are no controls or protections for your inheritors.
A trust is a vehicle written with more details for your instructions and during life you maintain the power to use your assets as you see fit, amend the instructions, or revoke them altogether. The biggest benefits of a trust emerge upon your passing when it becomes irrevocable. This means the assets inside are permanently subject to the wishes you’ve laid out, and valuable protection from creditors, future divorce, and overspending can be provided. Generally speaking, those with less complicated situations should at minimum have a will, which does cost less to prepare.
However, we’ve found most families prefer the guidance and protections available with a trust, even though they cost a bit more to prepare. Deciding whether a will or trust is right for you is only the first step when it comes to building an estate plan to protect your family.
If you’d like to learn more or connect with a fiduciary Financial Planner that can guide you through the process and what it means for your finances as a teacher, don’t hesitate to give us a call or drop us an email.