Determining whether you need a will or trust

Q: What is the governing document for a trust?

The governing document for a trust is the trust agreement or trust deed. This document outlines the terms of the trust, the roles of the trustee and beneficiaries, and how the trust assets are to be managed and distributed. It serves as the foundation for the trust's operation and legal standing.

Full question:

Which legal documents do we need? (will or trust?) Please be as specific as possible. We are unsure if we need a trust since we do not own a home. 1) We have children who are minors and need to make sure their guardians are chosen and stated. 2)We do not own a home and have no significant assets at this time. 3)We would like to state our medical wishes. 4)Matthew is the sole beneficiary for his aunt and uncle's estate and business. 5)Matthew hold interest in his father's business.

Category: Wills and Estates
Date: 04/07/2025
State: National

Answer:

I am prohibited from giving legal advice. The answer will depend on all the facts and circumstances involved. Important tax considerations will be a factor. I suggest contacting a local retirement planner or tax professional who can review all the facts and documents
involved.

Generally, a person states his wishes about being his life prolonged by artificial means in a living will. This is typically a separate document from a testamentary will. It may also be combined with a power of attorney for health care, in which a person is appointed to make medical decisions for you if you are unable to do so.

A testamentary will is used to direct how one's estate should be disposed of. A will, such as many wills offered on our site, may also contain a provision for appointing a guardian for minor children. A trust may also appoint a guardian for minor children. A will does not
take effect until your death. A living trust is a manner of transferring property that is effective immediately. A testamentary trust may also be created in a will, so that rather than giving money outright to a minor or other heir, a trustee is responsible for handling disbursements
according to the conditions specified in the trust.

A trust is often used for estate planning in order to avoid the probate process. When you die and your estate enters probate administration, the court will oversee how your property is transferred. When you create a living trust, there are administrative steps you have to take while living in order to transfer your property into your trust. With a will, once you create your will and properly sign it, you will normally not have any need to take any more steps to ensure your wishes are carried out at your death.

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

What is a trust agreement document?

A trust agreement document is a legal document that establishes a trust. It outlines the terms of the trust, including the trustee's responsibilities, the beneficiaries, and how the trust assets should be managed and distributed. This document is essential for ensuring that your wishes regarding asset management and distribution are legally binding.

What is the legal document of a trust agreement?

The legal document of a trust agreement is typically called a trust deed or trust instrument. This document specifies the details of the trust, including the parties involved, the assets placed in the trust, and the rules governing the trust's operation. It is crucial for defining how the trust will function and how assets will be handled.

What are the most important legal documents to have?

The most important legal documents to have typically include a will, a living will, a healthcare power of attorney, and possibly a trust. A will outlines how your estate will be distributed and can name guardians for minor children. A living will details your medical wishes, while a healthcare power of attorney designates someone to make medical decisions on your behalf.

What documentation do I need for a will?

To create a will, you generally need to provide personal identification, a list of your assets, and the names of your beneficiaries. If you have minor children, you should also include the names of guardians. It's advisable to consult with an attorney to ensure that your will meets state requirements and accurately reflects your wishes.

What is the governing document for a trust?

Do you need a trust if you have a will?

You do not necessarily need a trust if you have a will, but a trust can offer benefits such as avoiding probate and providing immediate asset management. A will takes effect after death, while a trust can manage assets during your lifetime and after your death. The choice depends on your specific circumstances and estate planning goals.