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What’s the Difference between a Will and a Trust?

Trusts are only for rich people, right? Nothing could be further from the truth because trusts are often an excellent choice for many Americans with average wealth. So, what is the difference between a will and a trust and which one is right for you?

What is a Will?

A will is a legal document that indicates how you want your assets to be apportioned when you die. You can revoke or change your will at any time. You can also name a guardian for your minor children in your will.

There are some disadvantages to wills. First, wills are of no use in the event that you become incapacitated, because a will springs into existence only when you die. So if you have a will and become incapacitated, your relatives will have to go to court to have a guardian and/or conservator appointed. Second, if you die with a will in place, your will must go through a process known as probate. This is a court process that is entirely public, expensive and can be lengthy. Anyone can go down to the courthouse to take a look at how many assets you had at your death and how much debt you had.

What is a Trust?

A trust is a legal document that designates a person to manage your property. There are many different kinds of trusts, but one of the most popular is a revocable living trust. A revocable living trust can be revoked or changed by you at any time before you die (as long as you are mentally competent), and it holds title to your assets during your life. Upon your death or incapacity, the revocable living trust makes it easy to transfer title of your assets to person(s) named in your trust. Trusts can also be structured to lessen the impact of estate taxes.

One disadvantage of a trust is that you have a bit more work to do setting up the trust and moving your assets into it. However, once you do, the heavy lifting is done and when you die, your family will greatly benefit by easy transfer of title and avoiding the lengthy and expensive probate process. Further, with a trust, the process is entirely private.

Our knowledgeable wills and trusts attorneys can help you decide whether a will or a trust is right for you. Contact us today.

What Does an Executor Do?

You may have heard the word “executor” but have no idea what one is. Or, maybe you’ve been asked to be an executor. Either way, it sounds like an important job, but what exactly does an executor do?

An executor is the chief administrator of a will. If you are drafting a will, your attorney will ask you who you want to be the executor. You may pick a relative, such as your spouse. However, you can pick anyone you think would be trustworthy and would do a good job. It’s important to exercise due diligence when selecting the executor of your will because it is an important job.

Executors are charged with processing the terms of the will, and some typical duties of an executor are:

Probate the will. This means initiating the court process known as probate through which the decedent’s assets are transferred to the beneficiaries.
Collect the assets of the decedent. The executor needs to perform a comprehensive search for all of the decedent’s assets. If the executor is careless or negligent in this task, the executor can be liable to persons who are negatively affected.
Pay the decedent’s debts
Pay administrative expenses
Pay taxes that are due on the decedent’s estate

After the debts, administrative expenses and taxes are paid, the executor distributes all of the remaining assets according to the terms of the will. Executors have a fiduciary duty to the estate and can be held liable for mismanagement. As a result, executors often retain an attorney or a certified public accountant to provide assistance.

Executors are reimbursed for expenses they incur throughout the process, and they are sometimes also entitled to statutory fees.

The choice of an executor is important, and if you are selected to be an executor, it’s a big responsibility. If either of these situations applies to you, contact an experienced estate and probate attorney at The Quitmeier Law Firm who can provide proper assistance to get the job done.

Who Will Inherit Your Digital Assets?

You may have created a will or trust to take care of the distribution of your financial assets and real property upon your death, but what about your digital assets?

Remember ? if you have online accounts, you probably own digital assets that will continue to exist after you die. It is important that you designate someone to take over control of these assets after you die.

We typically equate Internet activity with younger generations. However, Internet usage spans all generations. If you have an email account, your emails and any files or photos shared in your account are considered your digital assets. If you are a Facebook user, the content of your account and any photos and videos linked to your account are digital assets. Pinterest boards, online gaming accounts, Twitter feeds, online photo albums, YouTube videos ? you name it, if you have signed up for it online, you have cyber or digital assets.

There are many ways to prepare for the management of your digital assets after you die. Some providers such as Google provide services that manage your accounts after death. For instance, Google allows you to designate beneficiaries to be contacted before deactivating your accounts. Google then keeps track of your online activity. After a period of inactivity, Google will contact you via text and email before deactivating your accounts. If no response is received, Google will contact your beneficiaries.

Additionally, there are online safe deposit boxes in which you may store your usernames and passwords. Alternatively, you could keep a list of your passwords in a safe place for a loved one or executor to use after you die. While executors can contact online service providers to request the contents of your online accounts, many services providers will decline to provide usernames and passwords.

Contact an experienced Missouri estate planning attorney at the Quitmeier Law Firm to help you plan for the distribution of your assets.

How is Real Property Divided Equally Under a Will?

When it comes to making a will, most parents want to ensure that all children are treated equally. As such, parents will typically provide for the equal distribution of their estate amongst their children.

So how does this equal division actually occur?

The equal division of a decedent’s financial assets is fairly straightforward. However, when it comes to real property, such as the family home, equal division can become complex. Many times, family members who inherit shares of real property get along well and are able to work together to come up with a solution. For instance, the parties may agree to sell the property and split the proceeds evenly. Sometimes, one family member chooses to retain the real property and forgo receiving a portion of the financial or other assets that are distributed amongst the other family members. Alternatively, the parties could work out a buy-out arrangement in which a family member who wishes to keep the property pays the other parties for their shares.

Unfortunately, siblings may disagree as to whether or not to sell the family home, or as to who gets to keep the property. If family members do not get along and an agreement cannot be made, intervention may be necessary. An executor will be responsible for playing referee between feuding family members. If the executor is not able to successfully mediate between the parties, it is a good idea to work with an attorney to help the parties come to a settlement. If the parties are still unable to settle, a partition suit may be necessary. A partition suit involves a forced sale by the sheriff. A partition sale often results in a low sales price, and it can make the parties financially worse off than they would have been through a settlement.

If you are the executor or beneficiary under a will involving real property, an experienced Missouri estate planning attorney at the Quitmeier Law Firm can guide you through the distribution process.

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