Many people only compose a last will and testament to convey their assets to their children or other beneficiaries. A will is not the only way you can grant an inheritance, though. You might find that setting up a trust can enhance your estate wishes and perhaps ensure that they come to pass following your death.
Using a trust involves satisfying legal requirements such as transferring ownership of your assets to the trust. However, once set up, a trust may prove effective in avoiding problems that may derail your estate plans. Forbes explains how people use trusts to fulfill their estate wishes.
Granting greater privacy
You may want to keep your estate as private as possible. A will becomes part of the public record following your death, so whatever assets you assign to your heirs will become known to whoever wants to read a copy of your will. A trust, however, remains private. Not only does a trust grant greater privacy, it may decrease the odds that someone will challenge your estate wishes in court since fewer parties will know what your estate wishes are.
Unlike a will, a trust does not pass through probate. Assets you place in the trust will pass directly to whoever you name as beneficiaries. This can eliminate probate costs that might burden your heirs. Also, using a trust can speed up the inheritance process. Your heirs do not have to wait on a court to authenticate a will and grant authority to an executor to distribute your assets.
Designating authority over your estate
A trust can also help when you want to transfer authority to someone to handle your assets without incident. When you form a trust, you might decide to serve as trustee. Upon your death, a successor trustee that you name will take over without court intervention. A successor trustee can also take over if you suffer incapacitation.
By contrast, a probate court will become involved if you only use a will to pass your estate to beneficiaries. A court will need to delegate authority to an executor to handle your estate. Even if you designate a person to serve as your executor, there is still the chance for delays in the process, plus your heirs may litigate the executor if they feel the executor is mishandling the estate.