There are many options to choose from when designing an estate plan. On the other hand, there are some legal documents which are especially useful for planning an estate in Maryland or in any other state. One of the most common legal instruments used in planning an estate is a will. However, instead of a will, some individuals may decide to create a trust instead of or in addition to the will.
Although a will may accomplish a person's estate planning goals, sometimes trusts are preferable when an individual wants to have more control over the administration of assets. However, there are several different types of trusts to choose from. Therefore, it can be essential to do thorough research into the best options when creating a trust.
One common type of trust is a testamentary trust. This type of legal trust will be enforced when a person dies. The trust will allow an individual to ensure that assets are distributed as he or she had intended, even if circumstances change after the person's death. Without a trust, situations may arise where assets are ultimately not distributed as one had intended.
For example, if a person wishes to leave his wife a million dollars in his will, the money will be in her name. Although it may have been the case that the money was intended to eventually be inherited by the couple's children, if the wife remarries and then dies suddenly, the new husband would be legally entitled to receive a portion of the money. A trust can help to avoid this by distributing the money over time to the wife with instructions to distribute the rest of the money to the couple's children after the wife dies. However, this is just one possible estate planning tool available in Maryland or in any other state.
Source: MarketWatch, 5 estate-plan strategies for boomers, Andrea Coombes, Nov. 29, 2013