As you work to create your estate plan, you may wonder whether you need to utilize certain planning options. Because each plan created needs to suit the particular wishes of an individual, what works for other people may not apply to your situation. A close assessment of your estate and personal details could help you decide how to design the best plan for your circumstances.
One planning tool, in particular, that may have you curious is trust. You may have heard about the various benefits this tool offers — such as avoiding probate — but just because a planning option has benefits does not mean that you have a need for those benefits.
Beneficiary designations
If you want to work toward keeping a portion of your estate out of probate, you may have already done so without utilizing a trust. If you have payable-on-death bank accounts or have designated direct beneficiaries for other property, those assets will not need to go through the probate process. Additionally, placing those assets into a trust could cause unnecessary complications and conflict. As a result, you may not have reason to create a trust to avoid probate.
No out-of-state property
Another reason a person may consider utilizing a trust could relate to having property out of state. Because real estate in another state would likely need to go through that area’s probate process in order for distribution to occur, surviving family may have additional steps and proceedings to go through. However, placing out-of-state property into a trust could help avoid such scenarios.
If all of your property resides in Arizona, your family will likely only need to go through the probate process in this state. As a result, you do not need to create a trust to protect them from multiple state legal proceedings.
Public record
Another reason some parties consider creating trusts relates to the privacy they can offer. Wills and probate proceedings go on public record, and as a result, anyone with interest could look into details of your estate. If you have no issue with your information going public, creating a will may cover your needs.
Trust or no trust?
In the end, choosing to create a trust comes down to your personal preferences and desires for your estate plan. If you feel uncertain as to whether this tool could benefit you, you may wish to gain more information on its uses.