Last Will And Testament

A legal document that communicates a person's final wishes, as pertaining to possessions and dependents. A person's last will and testament will outline what to do with possessions, whether they are being left to another person, group or donated to charity, and what will happen to other things for which they are responsible, such as custody of dependents and accounts and interests management.

Living Trust

A Living Trust (also know as a Revocable Living Trust)("RLT") can be used as a substitute for a will by providing for the distribution of assets upon the grantor's death. This allows for a faster and less costly method of asset transfer than a will, which requires court supervision or probate. Unlike a will, which comes into play only after you die, the living trust can start benefiting you while you are still alive. The trust is revocable in nature, which allows you to make changes to fit your personal situation.

Let's look at some of the advantages of having a revocable living trust in place:

• Avoidance of Probate - Probate is the legal process for transferring your property when you die. Establishing an RLT can be especially useful in avoiding expensive multiple probate proceedings when you own real estate or other property in several states. Assets named in trust avoid the costly courts and typically take precedence over the property designated in your will. Changeable or Revocable - The living trust allows you to make changes (or amendments) to the trust document while you are still alive.

• Privacy Preservation - Trusts allow the transfer of your personal assets to remain private within the constraints of the trust document. The probate process may expose yourestate to the public.

• Eliminate Challenges to the Estate - The standard will can create family disputes at your death and be challenged for alteration by any member of your family. By using a trust, you can specifically disinherit anyone who posts a challenge to your wishes upon your death.

• Segregation of Assets - This is useful for married couples with substantial separate property that was acquired prior to the marriage. The trust can help segregate those assets from their community property assets.

• Assignment of Durable Power of Attorney/Guardianship - A living trust can be used to help control a guardian's spending habits for the benefit of your minor children. It can also authorize another person to act on your behalf if you become incapacitated and need someone else to make medical decisions for you.

• Continuous Management - This allows the wealth that you've accumulated to continue to grow for multiple generations by using a professional trustee to manage your property. You can limit the amount of withdrawals to income only, with special emergency provisions if you wish.

• Estate Tax Minimization - While the RLT is not a good tax minimization tool on its own, provisions can be included in the trust documentation to transfer wealth by establishing a credit shelter trust ("CST") in the event of your death. The CST is a very effective tool to help reduce estate taxes for large estates that exceed the combined estate tax exclusion amounts.

• Pour-Over Will - All of RLT also come with a Last Will and Testatment called a Pour-over will to captaure and any assets that have failed to be transferred into the trust thereby protecting all your assets from control of the State.