Gone should be the days when an executor -- a person designated to manage and distribute a decedent's estate -- assembles heirs and beneficiaries together to reveal the specific instructions in a last will and testament. At least, an attorney that focuses on estate planning might hope that such an approach is a thing of the past, for several reasons.
First, a will generally requires probate. That, in turn, usually means court involvement, time delays and administrative expenses. Yet there are so many other methods of transfer that can bypass a will.
For example, a variety of instruments allow an individual to directly designate beneficiaries, such as payable on death accounts, joint tenancies with a right of survivorship, assets put into a trust, life insurance accounts, and retirement accounts like IRAs or annuities.
An individual might have concerns about being locked into an irrevocable trust arrangement. For that individual, a living or revocable trust might be the solution. A revocable trust allows the individual (referred to as the settlor) to serve as the initial trustee. Upon the individual's death, a successor trustee will assume control of managing the trust assets. The settlor's passing often converts a revocable trust into a revocable trust. During the individual's lifetime, however, trust assets and instructions can be changed freely.
An attorney can answer questions about whether a trust might be the best fit for an individual's particular estate planning goals. For example, trusts can be expensive, and some of the alternative methods of transfer, including joint ownership or beneficiary designations, might provide more inexpensive ways of accomplishing similar goals. Check out our firm's website page on trusts to learn more.