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There are a lot of estate planning tools available to you. The following table summarizes the benefits provided by some of the more common estate planning techniques. Talk to your estate planning attorney for the details. (Note: For definitions of the estate planning tools compared in this table, i.e. "Pour-Over Will", scroll to the bottom of this page)

 

Benefit of Planning Tool No
Will
Basic
Will
Pour-
over Will
Living
Trust
AB
Trust
QTIP
Trust
Selectivity
Permits you to select the beneficiaries of your estate No Yes Yes Yes Yes Yes
Permits you to select the executor of your will No Yes Yes Yes Yes Yes
Permits you to select the trustees of your trust No No Yes Yes Yes Yes
Permits you to select the guardians for your children No Yes Yes Yes Yes Yes
Probate
Avoids the time-consuming and expensive probate process No No No Yes Yes Yes
Timing of Distributions
Permits distribution of assets to children other than simply upon reaching the age of majority (Ex. 1/3 at age 25, 1/3 at age 30, 1/3 at age 35) No No Yes Yes Yes Yes
Protection
Prevents conservatorship of estate owner No No No Yes Yes Yes
Protects assets from creditors No No No Yes Yes Yes
Estate Taxes
Assists married couples in reducing estate taxes No No Possibly, if properly designed to save estate taxes No Yes Yes

Allows the first spouse to die to name the ultimate beneficiaries of his/her estate while still permitting the surviving spouse to utilize the assets and while still deferring estate taxes

No

No

Yes

No

No

Yes

No Will means you have no will, and your estate passes to your heirs based on the laws of descent and distribution of your state.

Basic Will means you have a will that distributes everything to your spouse, if living, otherwise to your children when they reach the age of majority.

Pour-over Will means you have a will that distributes everything to a trust.

Living Trust means a trust designed to avoid probate and provide asset management. A basic living trust does not effectively use the $675,000 unified credits of both spouses. Remember, each person is entitled to have the first $675,000 of his or her estate pass to his or her heirs without estate taxes. This is referred to as the "unified credit." Because of this deficiency of a basic living trust, an AB Trust is often recommended instead to married couples with substantial assets.

AB Trust means a trust designed to make sure the $675,000 unified credit of each spouse is used to the full extent possible, while allowing the surviving spouse to have the use of the assets of the deceased spouse during the remainder of the surviving spouse’s lifetime.

QTIP Trust means a trust designed to permit a spouse to transfer assets to his/her trust while still maintaining control over the ultimate disposition of those assets at the spouse’s death. QTIP Trusts are particularly popular in situations where a person is married for a second time but has children from a first marriage for whom he/she wants to reserve assets.

Source: FindLaw

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