If you haven't considered using a revocable trust rather than a will as your main estate planning document, you could be making a critical mistake.
A recent MoneyWatch article, “5 reasons you need a trust, not a will,” lists five reasons for using a revocable trust as the primary method for disposing your estate.
1. Pass on assets privately, quickly and efficiently. A revocable trust as a vehicle to distribute your estate allows your beneficiaries some privacy. The trust isn't filed with the probate court and isn't a public document (unlike a will). Property transferred into a revocable trust during your lifetime isn't subject to the expense and delays of probate.
2. Preserve assets for heirs and charities. Changes can be made to your revocable trust anytime. However, when you pass away, the trust becomes irrevocable. The provisions that pertain to the disposition of assets to your heirs and charities will be administered by your trustee under the trust’s terms.
3. Assets that remain in your trust after your death typically aren’t considered marital property. Those assets aren't subject to division in a settlement if the beneficiary gets divorced. However, in many states, a divorce court may take the beneficiary's income interest into consideration when determining the division of marital property or support obligations. (If this is a concern to you, let's talk about FL law.)
4. Retain control over distributions. A trust can contain language that says when distributions of income and principal will be available to beneficiaries, and it can have distributions for specific purposes like education or health care expenses. A trust can also include language for distributions based on attaining specific ages. For example, one-third of the principal is distributed at age 30, half at 35 and the rest at 40.
5. Distribute retirement accounts efficiently. If the trust is the beneficiary of your retirement accounts and if it is written correctly, the trustee can limit withdrawals to the retirement account's minimum required distributions based on the life expectancy of the oldest beneficiary. This avoids the mistake of a beneficiary liquidating a retirement account and triggering a large income tax obligation.
Please make an appointment to discuss if this strategy will work for your specific circumstances.
Reference: MoneyWatch (September 17, 2015) “5 reasons you need a trust, not a will”