Although trusts have been around for centuries, historically, the Last Will and Testament was the centerpiece of an estate plan.
However, in the past several decades, there has been a growing emphasis on avoiding probate (i.e., the court-supervised administration of estates) as the major objective of an estate plan.
In conjunction with this trend, various alternatives to Wills have arisen, for example, pay-on-death/transfer-on-death beneficiary designations for financial accounts and beneficiary deeds for real estate (also known as transfer-on-death deeds). These Will substitutes and trusts are estate planning devices that avoid probate.
It’s important to keep in mind that, generally speaking, a Last Will and Testament requires probate. For the most part, it is an ineffective document until it is admitted by the probate court. Well, as previously stated, avoiding probate is now one of the biggest goals of estate planning.
If the only concern is to simply give property to the intended person outside of probate court, then beneficiary designations are usually sufficient for that purpose. However, depending on a variety of factors, such as family dynamics (blended vs. traditional family, spendthrift children, minor beneficiaries, sibling rivalry, special needs children, etc.), the possibility of predeceased children, the size of the estate, etc., a trust may be required to fully achieve your estate planning objectives, beyond simply avoiding probate.
Hunter Green
Attorney at Law
Green Law Firm, PLLC