Estate planning is an important process that everyone should go through to ensure that their loved ones get taken care of in the event of their death. When estate planning in Arizona, you have the option of creating a will or trust. While both documents can help you achieve your estate planning goals, there are some key differences between wills and trusts.
Estate planning
Estate planning is the process of organizing your finances and creating a plan for how you want your assets distributed after you die. The aim of estate planning is to take care of your loved ones and their needs. There are a number of different tools that you can use in estate planning, including wills, trusts and powers of attorney.
Wills
A will is a document that outlines how you want your assets distributed after you die. In order for a will to be valid, the person making it must usually have testamentary capacity, meaning they are of sound mind and able to understand what’s going on. A properly drafted will should also include a self-proving affidavit, which simplifies probate by allowing you to skip court proceedings when your heirs file for distribution.
Trusts
Trusts are a type of estate planning tool that hold assets, such as property, for the benefit of another person or group of people. There are a number of different types of trusts, including revocable, irrevocable and testamentary trusts. Trusts share one common goal: to avoid probate. You can also use trusts to reduce taxes and keep your estate out of the hands of creditors.
Wills and trusts are both important estate planning tools, and they serve different purposes. When choosing between a will and trust, it’s important to consider your specific needs.