You’ve heard the saying “You get what you pay for” – usually about the time that you have discovered that the great deal you snagged did not really save you anything because what you purchased did not live up to your expectations. And now you have to spend more money to fix it or replace it.

This saying can, all too often, hold true for your ESTATE PLANNING as well. Sometimes the least costly solution is simply not the best solution, nor the most cost-effective. A WILL, for instance, is cheaper than a TRUST, at least in the near term. It costs less to the person obtaining it and, of course, only becomes operative upon you passing.

But to make it effective on your passing, especially where you own property that is titled (i.e. real estate), your heirs will have to probate the WILL, have someone appointed as a Personal Representative, pay the costs for filing with the court, administer the PROBATE estate, and possibly pay an attorney to assist them.

On the other hand, a TRUST may cost more up front, but in the long run is often able to leave more to the TRUST beneficiaries because the TRUST does not have to incur the costs associated with PROBATE administration. Further, the TRUST does not need to be submitted to the court to be made effective. Rather, a TRUST becomes operative immediately after you create it, and you can use it as the central mechanism to coordinate your ESTATE PLANNING needs. And, because it becomes effective immediately, management of the TRUST assets is easier during the lifetime of the trustor (the person creating the TRUST) especially where the trustor becomes impaired. In this instance, a successor TRUSTEE takes over without court intervention, and provides a seamless process for management of the TRUST assets for the benefit of the trustor, without resorting to the need for a CONSERVATORSHIP proceeding (another type of PROBATE proceeding which declares a person incompetent and appoints a person called a CONSERVATOR to manage the incompetent person’s property and assets for the benefit of the incompetent person).

On the other hand, a TRUST may cost more up front, but in the long run is often able to leave more to the TRUST beneficiaries because the TRUST does not have to incur the costs associated with PROBATE administration. Further, the TRUST does not need to be submitted to the court to be made effective. Rather, a TRUST becomes operative immediately after you create it, and you can use it as the central mechanism to coordinate your ESTATE PLANNING needs. And, because it becomes effective immediately, management of the TRUST assets is easier during the lifetime of the trustor (the person creating the TRUST) especially where the trustor becomes impaired. In this instance, a successor TRUSTEE takes over without court intervention, and provides a seamless process for management of the TRUST assets for the benefit of the trustor, without resorting to the need for a CONSERVATORSHIP proceeding (another type of PROBATE proceeding which declares a person incompetent and appoints a person called a CONSERVATOR to manage the incompetent person’s property and assets for the benefit of the incompetent person).

TRUSTS have other benefits too. Because you avoid filing PROBATE, your estate plan remains confidential. For many people, this is a very important consideration. Where you have a significant amount of assets, a TRUST can help reduce estate taxes which in turn allows you to leave more of your property to your family, friends and charities.

Despite this article’s seeming bias towards TRUSTS, TRUSTS are not an end-all, be-all solution. Rather, it is one tool among others. But all too often, people make their decisions about a WILL versus a TRUST on the basis of the immediate price alone. Other considerations like the size of your estate, the kinds of assets you own, the mix of different asset classes, and family dynamics (just to name a few) are usually far more important in determining whether you will be best served by a WILL or by a TRUST.

To determine which is right for you, and to discuss other estate planning alternatives, seek out an experienced Phoenix estate planning attorney who can assist you in making the best choice for you. As is probably evident from the above article, ESTATE PLANNING issues can come in a variety of shapes and sizes and can utilize a variety of tools to accomplish your goals.  While this article discusses some basic issues regarding ESTATE PLANNING, WILLS AND TRUSTS, it is not intended to be exhaustive.  Because these issues can be complex, subtle and often times difficult to spot, it is best to speak with a knowledgeable attorney to discuss your specifics.  If you are interested in discussing your ESTATE PLANNING, contact our office by calling 602-277-4441 or fill out the form below to schedule a consultation with one of our experienced attorneys.

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Platt and Westby, P.C. has offices in Phoenix and Gilbert, Arizona.