Estate planning involves deciding who will inherit your assets and property when you pass away. Planning your estate also entails giving someone the power to manage your financial affairs if you become incapacitated. If you’re a Florida resident, here are some things you should know about wills and trusts.
What does the estate planning process entail?
Planning your estate includes several documents. Wills and trusts are limited in power, so it’s important to know the difference between the documents to make sure your estate plan is clear.
What is a will?
When it comes to wills and trusts, you should know that wills are necessary for everyone, even if you don’t have many assets. Wills specify who is entitled to your assets when you die. Your representatives and executors should also be named in your will. The executor ensures that your assets are distributed according to your wishes. You can use a will to protect your personal valuables, family heirlooms and real estate. You can also name a guardian for your children in the will if your children are minors or have developmental disabilities.
What is a trust?
Trusts are legal entities created to manage and hold your assets and other major decisions throughout your life. You are the grantor of the trust, and the people you name in the trust are trustees. Upon your written permission, the trustees are given the legal title to the property in the trust. From that point, the trustee is responsible for investing, managing and protecting the trust property and income on behalf of the beneficiaries.
Estate planning is not the same as creating a will. However, making sure your will is legally binding is an important part of organizing your estate, and you may want to consider including a trust.