When we have a family to care for, planning for and protecting your assets becomes even more imperative. There are many assets you have to consider when writing a will or setting up a living trust, such as:
- Your savings
- Any valuable objects, jewelry or heirlooms
- Your pension
- Your business – if applicable
- Stock market investments
- Your property
Writing a will, though, can seem like a complicated and arduous task, and before you even start writing one, you need first to decide who gets what. What’s more, there is nothing stopping your will being taken to probate, where your wishes could come undone.This is when a living trust can be greatly beneficial.
The following guide is going to help you work out the basics of writing your will and setting up a living trust so that you can live the rest of your life with peace of mind.
Decide who gets what
Before you visit a solicitor, you need to outline the basics of who gets what. This means, first and foremost, deciding on the assets you have, and then assigning them to someone or an organization. When determining the beneficiaries, you may include:
- Family
- Friends
- Charities
- Your partner or spouse
However, be sure that your wishes align with your spouse or partner’s wants before continuing. Keep in mind that you may have other family that you have lost touch with over the years that you would like to bring into your last will and testament. If this is the case, then utilizing Accurate Person Tracing Services at Bondrees.com, for example, could be highly beneficial in finding where they are so you can reconnect and get the outcome you are planning for.
Estimate the value of your assets
Assets that are easier to value include your savings and your valuables. Once these have been dealt with, you will then need to tackle the harder assets: pension, business, property, and stock market investments. Lastly, you will then need to consider the sentimental items you wish for people to have.
If the value of your estate is significant and your last wish is to avoid probate, then one of the benefits of a living trust is that it avoids a trip to the probate court. By having a living trust rather than just a will, or a will at all, your assets will be distributed as your wishes. If you require assistance with organizing your assets, you can hire the help of a professional and knowledgeable estate planning attorney.
Heed extra caution with your pension
Before you list your pension as an asset, you will need to check the rules. The value of your pension depends on the scheme, and in some cases, you may not be able to include it.
Know how you want to split your assets
If you have more than one child and an extensive number of family members, you may want to leave part of your savings, etc. to specific members. There are many types of legacy requests you can make, such as:
A pecuniary bequest
“I leave $1,000 to my daughter.” This means you leave a fixed sum to your selected person.
A specific bequest
“I leave my vinyl collection to my son.” It means you leave a certain item, which you own, to your person of choice.
A reversionary bequest
“I leave my share of the house to my husband if he survives me. However, if he does not survive me, then it will be passed on to my son.” Instructions specifying what happens if the person you leave it to dies before you.
A residuary bequest
“I leave half my estate to my sister.” Means you leave a certain percentage of your estate to your person of choice. The amount the person receives, though, depends on the value after debts, costs, etc.
A living trust
“I leave my share of the house to my wife for the rest of her life. When she passes, however, it will be passed over to my son.” A living trust means you can dictate who gets your property, for instance, after you die, as well as who inherits it once that person also dies. If you wish your real estate to avoid court, you need to get it titled in the name of a living trust.
How to protect your beneficiaries
You may wish to safeguard your bequest, especially if you are leaving something to someone with disabilities, mental health issues or a child. Many people will set up a trust, which means what you leave can be managed by people you trust.
Once you’ve decided on your assets
With your assets valued and you know who gets what, it is time to contact professionals to help draw up your will or living trust. If you have a large estate, then you will want to safeguard your estate with the protection a living trust offers. The last step is, if you wish to, to discuss with your family about choices beforehand.