You have many decisions to make when you’re creating an estate plan. One of these is how you will get your assets to the intended beneficiaries. Some people include these instructions in their will, but that means that the distribution will have to go through the probate process.
Before you decide that’s how you’ll handle your assets, you should learn a bit about setting up a trust. A trust is a legal tool that has several benefits, one of which is bypassing the probate process.
How does a trust bypass probate?
When a trust is properly created and funded, it’s managed and distributed according to the terms of the trust, so it doesn’t have to go through probate. In order to make this happen, you must be sure to appoint a trustee who will manage the trust’s contents. They will also ensure that the intended beneficiaries receive the assets they’re due.
Why is avoiding probate beneficial?
Avoiding the probate process has several benefits. One of the most important is that the beneficiaries have privacy. The probate process includes the terms being recorded, so anyone can find out how assets were distributed. Since a trust doesn’t have to go through the probate process, the terms of the distribution aren’t part of the public record.
Trusts typically contain very clear instructions and terms for distribution. The distribution can usually occur faster through a trust than what’s possible if it goes through the probate process.
The key to your loved ones having these benefits is that the trust has to be set up properly, and it must be funded. If you’re interested in including a trust as part of your estate plan, you should work with someone who’s familiar with your wishes and can help you to determine how to proceed.