Episode 2: Will or Revocable Living Trust? Memento Mori Estate Planning Podcast
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- Education
Should I have a will or revocable living trust? The answer to this question is crucial to estate planning. Its answer informs the very building block of a workable plan. Your goals cannot be addressed until you have reached a decision on your plan’s “anchor instrument.” Every estate plan is anchored by a core document from which other components of the plan proceed. This instrument is either a will or a revocable living trust.
Many people contact an estate planning attorney seeking a will. Television, books, and tradition have elevated wills to a place of prominence in the minds of laypeople. Their parents, relatives, and friends might have executed a will, so it’s often the instrument with which most people are familiar. On the other hand, a trust sounds daunting. “Isn’t it for rich people? It must be expensive.” Is a will right for you 2022?
A will costs more in the long run. While it’s true that will-based estate plans require a lower initial investment, most costs arise many years after the will has been drafted. An average married couple might spend between $1,500 and $3,000 on a will. After the first spouse dies, the surviving spouse will commence a probate proceeding. On top of probate costs, that spouse will spend between $8,000 and $10,000 in attorney’s fees. After the surviving spouse dies, the estate’s heirs will incur another $8,000 to $10,000 in attorney’s fees. Thus, the actual cost of a will based plan lies between $17,500 and $23,000.
A trust-based plan, in contrast, does cost more up front. Trust drafting fees may run between $2,000 and $6,300. However, because there is no probate oversight after death, a married couple would save on post-death attorney fees. Thus, the average couple can expect to save between $7,000 and $20,000 in attorney fees by opting for a revocable living trust instead of a will.
By drafting a will, a couple makes a deliberate choice to settle their estates via the probate process. Upon the death of a spouse, that spouse’s assets will likely be frozen until the Court determines the rightful heirs of those assets. This process may take one year or more depending on the complexity of the estate. Additionally, all of the estate’s assets become a matter of public record.
A revocable living trust mostly avoids probate in Connecticut. Assets remain private. Since the trust owns all assets, there is no period during which assets are frozen following a trust-maker’s death. Beneficiaries may use and enjoy all of the trust-maker’s assets immediately after his or her death.
A will is a testamentary instrument, meaning that it governs the disposition of property following a person’s death. It comes into effect ONLY upon a person’s death, and it has no legal authority to convey property or express a person’s wishes as long as that person remains alive. Though often used in the context of estate planning, a trust is not solely a “death” instrument. Generally, a trust is any type of legal relationship in which one person (the trust-maker) gives a right to second person (the trustee), and that trustee holds that right for the benefit of a third person (the beneficiary). This distinction between a will and trust is crucial when a person experiences a period of sickness or incapacity.
In the twenty-first century, very few people experience death as an instantaneous event. Rather, modern medicine has made it possible to care for a person during periods of significant decline. During these periods, a person may not be able to care for himself or make decisions regarding his property or legal rights. In these situations, the Court will step in and appoint a conservator. This conservator essentially will step in and appoint a conservator to take control of a person’s property. The conservator may or may not be related to the person conserved. A will, as a testamentary instrument, has no ability to name a conservator for a
Should I have a will or revocable living trust? The answer to this question is crucial to estate planning. Its answer informs the very building block of a workable plan. Your goals cannot be addressed until you have reached a decision on your plan’s “anchor instrument.” Every estate plan is anchored by a core document from which other components of the plan proceed. This instrument is either a will or a revocable living trust.
Many people contact an estate planning attorney seeking a will. Television, books, and tradition have elevated wills to a place of prominence in the minds of laypeople. Their parents, relatives, and friends might have executed a will, so it’s often the instrument with which most people are familiar. On the other hand, a trust sounds daunting. “Isn’t it for rich people? It must be expensive.” Is a will right for you 2022?
A will costs more in the long run. While it’s true that will-based estate plans require a lower initial investment, most costs arise many years after the will has been drafted. An average married couple might spend between $1,500 and $3,000 on a will. After the first spouse dies, the surviving spouse will commence a probate proceeding. On top of probate costs, that spouse will spend between $8,000 and $10,000 in attorney’s fees. After the surviving spouse dies, the estate’s heirs will incur another $8,000 to $10,000 in attorney’s fees. Thus, the actual cost of a will based plan lies between $17,500 and $23,000.
A trust-based plan, in contrast, does cost more up front. Trust drafting fees may run between $2,000 and $6,300. However, because there is no probate oversight after death, a married couple would save on post-death attorney fees. Thus, the average couple can expect to save between $7,000 and $20,000 in attorney fees by opting for a revocable living trust instead of a will.
By drafting a will, a couple makes a deliberate choice to settle their estates via the probate process. Upon the death of a spouse, that spouse’s assets will likely be frozen until the Court determines the rightful heirs of those assets. This process may take one year or more depending on the complexity of the estate. Additionally, all of the estate’s assets become a matter of public record.
A revocable living trust mostly avoids probate in Connecticut. Assets remain private. Since the trust owns all assets, there is no period during which assets are frozen following a trust-maker’s death. Beneficiaries may use and enjoy all of the trust-maker’s assets immediately after his or her death.
A will is a testamentary instrument, meaning that it governs the disposition of property following a person’s death. It comes into effect ONLY upon a person’s death, and it has no legal authority to convey property or express a person’s wishes as long as that person remains alive. Though often used in the context of estate planning, a trust is not solely a “death” instrument. Generally, a trust is any type of legal relationship in which one person (the trust-maker) gives a right to second person (the trustee), and that trustee holds that right for the benefit of a third person (the beneficiary). This distinction between a will and trust is crucial when a person experiences a period of sickness or incapacity.
In the twenty-first century, very few people experience death as an instantaneous event. Rather, modern medicine has made it possible to care for a person during periods of significant decline. During these periods, a person may not be able to care for himself or make decisions regarding his property or legal rights. In these situations, the Court will step in and appoint a conservator. This conservator essentially will step in and appoint a conservator to take control of a person’s property. The conservator may or may not be related to the person conserved. A will, as a testamentary instrument, has no ability to name a conservator for a