End of life decisions about one’s estate and assets can be tricky and confusing regardless of one’s age.
There are plenty of websites that can be helpful while reviewing options. However, one thing is certain. State laws vary. When preparing a will or trust, it is crucial to consult and utilize the services of a knowledgeable attorney in the state where you live (primary residence).
Let’s start with some basic definitions. According to the CDC Foundation, a will, or a last will and testament, is a legal document that describes how you would like your property and other assets to be distributed after your death. When you make a will, you can also use it to nominate guardians for your children, dependents, or pets. The site clearly identifies the benefits of having a will.
The commercial website Rockpoint Probate Funding defines a trust as “a legal arrangement in which assets are placed under the care of a trustee. This trustee manages the assets on behalf of beneficiaries, either during the trust creator’s lifetime or after that person’s passing”.
According to the MetLife.com, one of the biggest differences between a revocable and irrevocable trust is one’s ability to make changes to the trust once it’s created. The grantor can modify a revocable trust, while an irrevocable trust is not as easily changed.
Both types of trusts can help protect your assets and allow you to leave them to specific beneficiaries. They each include a grantor, or the creator of the trust, beneficiaries who will receive your assets, and a trustee, who manages your fund and distributes the assets.
NerdWallet.com is another website worth reviewing for valuable background information on wills and trusts.
According to Rehoboth Beach attorney Rebecca Doyle, revocable trusts can serve as an alternative to wills, and is advisable if an individual wants to accomplish any of the following goals:
– Asset protection for loved ones, particularly when the client wishes to shield a beneficiary from creditors, debtors, or spouses in the event of a divorce.
– Retention of control over assets posthumously, which includes providing for a beneficiary for life and deciding the final recipients of the assets. This option often is used in blended families and when beneficiaries are minors or have a history of spending, gambling, or substance abuse issues.
– Avoidance of multi-state probate, useful for clients owning real property in more than one state or in multiple counties within a single state.
– Probate avoidance to reduce probate fees, to keep the estate private, and to streamline the management of their estate, making the process more efficient and less burdensome for their loved ones.
Making the right decisions regarding wills and trusts is predicated on developing a prudent estate or financial plan. The founder of Dedicated Financial Len Hayduchok has some advice for making important life decisions and especially in regard to financial issues. According to Hayduchok:
– Financial planning is a complete review off aspects of a financial situation, that includes generating income, building wealth, reducing taxes, neutralizing risk and leaving a legacy. Retirement planning and estate planning are included under the financial planning umbrella.
– Retirement planning is an income story, requiring lifetime income needs to be met without earning income.
– Estate planning deals with the transfer of assets after one’s passing and includes end of life planning.
As you continue your journey, Doyle and Hayduchok have some resources to share. Doyle Law’s site has a page dedicated to Estate Planning, with the option of a free consult. Hayduchok also offers free resources on his “Legacy Planning” page with several videos on the topic, as well as a Latter Life Checklist to guide you through your planning.
No matter how overwhelming it feels, it’s important to help ease the process for our loved ones. Just start the journey, read one more article, tackle one more piece, one step at a time.
By Mary Jo Tarallo, Resident Journalist
Mary Jo Tarallo spent much of her career in public relations with various non-profits and spent 40 years involved with the ski industry as a journalist, public relations director for a national trade association and as executive director of the Learn to Ski and Snowboard initiative. Prior to her ski industry involvement she worked for the Maryland International Center in Baltimore and United Way of Central Maryland. She won a Gold Award for TV programming for a United Way simulcast that starred Oprah Winfrey. She has been cited for her work by numerous organizations. Mary Jo grew up in Baltimore, attended the University of Maryland and Towson University, lived in Washington, DC for 21 years and has been a full time resident of Rehoboth Beach and Milton since May 2019.
