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Will vs Trust: Which Is Better For New Jersey Residents?

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Preparing an estate plan for managing and distributing your assets in the case of death is one of the most important steps you could take to protect and provide for loved ones.
July 5, 2022 ★  | | |

When considering estate planning, you may be wondering which legal document will best protect your assets and provide for your loved ones. A will is a legal document that sets forth the particulars of your estate - who gets what, when, and how. It's important to keep in mind that a will isn't always the best option - living trusts can provide many of the same benefits, without the probate process. This article explores the pros and cons of both wills and trusts, as well as the different types of trusts available in New Jersey. Hopefully, this will help you make an informed decision about the best way to plan for your estate!

Wills

Estate planning can be a complex and time-consuming process. That's why it's important to have a will in place - it will help you make sure that your loved ones are taken care of after you die. Additionally, wills can be updated or amended at any time, so it's always important to review and update them as needed. If someone wants access to your property without getting married first, they may have to go through your will in order not to inherit anything intestate (without an inheritance). So, whether you're planning for the future or just want to make sure your estate is handled smoothly in the event of your death, a will may be the best way to go.

Living wills and advance directives for medical decisions

For many people, living wills and advance directives are important planning tools for making healthcare decisions in advance. This is because they allow residents of New Jersey to ensure that their wishes are followed if they become unable to speak for themselves due to a medical condition. If a resident has a will, it should be updated every few years to reflect any changes in his or her health or estate planning needs. A trust is also an option for those who want more control over their medical care than living will or advance directive provide. Regardless of the choice residents make, it is important to remember that both living wills and advance directives are legal documents. So, make sure to consult with a lawyer to make the best decision for you and your loved ones.

Power of attorney

If you are unable to speak for yourself due to a physical or mental incapacity, a power of attorney can help appoint someone to make healthcare decisions on your behalf. This document is often called a living will because it allows you to make medical choices even if you don't have the ability to do so yourself. A trust, on the other hand, is an important legal document that enables another person (the trustor) not only make financial and property decisions for the beneficiary but also control their access to information and communication. Both documents have their benefits and should be considered depending on the individual case at hand.

Living will

A living will, also known as a last will and testament, is important to ensure that your wishes are carried out if you become incapacitated and unable to speak for yourself. This document can also help provide guidance and clarity on who should be the ones making medical decisions for you if you cannot do it yourself. A living will can even be executed even if you are not terminally ill, provided that your overall health is good. You'll need to appoint an executor for your will. And lastly, always have your lawyer review your living will for legal accuracy - this way, nothing will get missed or forgotten!

Creating advance directives

There are many reasons why it is important for people to have advance directives in place. They provide peace of mind, help family members stay together and reduce the stress of medical decisions-making. A will is always preferable as it goes through probate - a much more formal process than drafting an advance directive. If you have any questions about creating an advance directive or living wills, speak to a lawyer or health professional.

What Is a Trust?

A trust is a tool for asset protection during and after life, created by an estate planning attorney. When the trust is created, assets are transferred into the trust, which is a legal entity. If it’s revocable, typically you are the grantor, trustee, and beneficiary. There are also other roles, like the successor trustee, who is the trustee if the primary is incapacitated and the beneficiary, the person who receives the assets. The trustee is a fiduciary and responsible for managing the assets for the best interest of the beneficiary.

Common Purposes for Trusts

Trusts are legal documents that allow you to allocate property and assets for the benefit of someone else. They can be used in estate planning, business structuring etcetera. There are a number of different types of trusts available, so it is important to pick the right one for your needs. A trust will often provide certainty and simplicity to beneficiaries - avoiding probate court proceedings altogether. Additionally, trusts offer tax advantages over other estate planning methods

Most Common Types of Trusts

There are a variety of trusts available to residents of New Jersey, so it's important to select the right one for your needs. A will is a good choice if you want to make sure your assets are distributed fairly after death. A trust can provide more flexibility and privacy in terms of who has access to your property and funds. Both wills and trusts have their benefits, so it's important to choose the option that best suits your situation and needs. If you're not sure which trust is the best for you, speak to an attorney who can help you understand the various trust types and their benefits.

Revocable or Irrevocable

When it comes to trusts, revocable and irrevocable are the two most common types. There are pros and cons to both of them, so it is important to understand their differences before making a decision. A revocable trust can be changed or revoked by the settlor at any time - this makes it less protective of your assets than an irrevocable trust. On the other hand, an irrevocable trust cannot be changed once set in motion - this is its major advantage over a revocable trust. Both trusts have their own advantages and disadvantages which should be taken into account when choosing between them. For example, while an irrevocable trust protects your assets better than a revocable one, it may not offer you as much flexibility during estate planning purposes.

Revocable Living Trust

Revocable living trusts allow the grantor full control. The assets are outside of the probate estate. Revocable trusts can be changed, assets may be added and beneficiaries can be changed. However, there’s no protection from creditors and no unique tax benefits.

Benefits of a Revocable Living Trust

A revocable living trust is a great option for residents of New Jersey for a number of reasons. First of all, it can help protect your assets from becoming subject to probate or estate taxes. Additionally, the trust can help you avoid complicated legal procedures and headaches down the road. If you're interested in creating a living trust, it's important to speak with an attorney about the requirements that must be met in order to ensure its validity. So, whether you're looking to protect your assets or streamline your estate planning process, a revocable living trust could be a great choice for you!

Irrevocable Living Trust

Irrevocable living trusts transfer assets upon death without going through probate. They provide stronger asset protection. Assets here are not accessible to creditors and, depending on how they are set up, may place assets outside of the taxable estate.

Benefits of an Irrevocable Trust?

For many residents of New Jersey, estate planning is a top priority. This is especially true for those who are planning on leaving a large inheritance behind. One estate planning option that may be of interest to these residents is an irrevocable trust. Irrevocable trusts offer a number of benefits that can be valuable to New Jersey residents, such as the ability to make changes without the trustee's consent, simplified estate planning, and more time for heirs to access assets. It's important to understand the different types of irrevocable trusts available so that you can select the right one for your needs. A lawyer can help you understand all the benefits and risks of creating an irrevocable trust, and ensure that you are fully aware of the trust's potential benefits.

Special Needs Trust

A Special Needs Trust is used to care for a person with special needs, while maintaining their government benefits. A spendthrift trust can be used to leave assets for people who aren’t capable (or interested) in managing funds responsibly. Trusts provide significantly more control over assets after death than wills. They may also be harder to contest after death, since they go into effect while you are living and may remain in effect for many years.

Living Trusts vs. Living Wills

The two legal documents that typically come into play with estate planning are a living trust and will. A living trust allows you to control your estate while still providing benefits such as tax optimization and privacy. A will only Testament the decedent's wishes, not alter their legal status after death. Both documents can be created in-state or out of state, depending on residency requirements. When deciding which option is best for you, it's important to take into account your unique situation. As with all legal decisions, it's best to speak to an estate planning attorney to get a better understanding of your options and make the best decision for you and your loved ones.

The Bottom Line

Estate planning is an important process that everyone should take into account. Whether you're planning to leave your estate to the people you want it to go to, or avoiding probate expenses and inheritance taxes - a will is always the best option. There are many benefits of will, such as avoiding probate expenses and inheritance taxes. However, a trust has some limitations, such as potential tax issues down the road. So, it's important to consult with an attorney when creating or updating your estate plan. The bottom line? Estate planning is an important process that will ensure your estate is handled in the best possible way, and you can rest easy knowing that you're taking the steps necessary to protect your loved ones.

We Can Help!

Estate planning is a complicated process that needs the help of an experienced New Jersey attorney. Contact us for a complimentary consultation and we can help determine what you need to properly create your estate plan.

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Law Firm of Benjamin Eckman
Planning Today for Your Family's Tomorrow

1767 Morris Ave., Suite 314
Union, NJ 07083

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73 Mt. View Blvd.,
Wayne, NJ 07470

1 University Drive, Suite 609
Hackensack, NJ 07601

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1767 Morris Ave., Suite 314
Union, NJ 07083

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By Appointment Only:

73 Mt. View Blvd.,
Wayne, NJ 07470

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Hackensack Office

1 University Drive, Suite 609
Hackensack, NJ 07601

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