Wills & Trusts Lawyers in Strathmore AB Helping Protect Your Future
Establishing what happens to you when you cannot make decisions for yourself, whether you have passed away or have become mentally or physically incapable, can be difficult. It’s essential to have someone alongside you to walk you through, explain, and verify everything for you. A properly trained and experienced will and trust lawyer, like those at Getz Collins and Associates, will help you align your estate by acting for you when you and your family need it most.
What is a Will?
Your “estate” is the property and assets you own at your death. When you die, your estate enters probate. Suppose you haven’t made a plan for your estate. In that case, a court decides how your debts are paid back to creditors. What is left remaining (after valuable personal items are possibly sold off to cover debts) gets distributed to the beneficiaries according to provincial law. As a process, probate can last several years, add staggering court fees to the estate’s debts (which more assets from the estate could be sold to pay off), and put your family through many unnecessary hardships.
A last will and testament is a crucial part of a person’s estate plan that names an heir or beneficiary. Naming an heir and having a fully founded estate plan can prevent your beneficiaries from accruing costly debt of their own. Without one, a court will be forced to divide your estate up according to how provincial law dictates. This could leave your beneficiaries without sentimental personal effects and a significant tax burden.
What is a Living Trust?
While a will ensures your estate is distributed correctly upon your passing, a living trust dictates how your estate acts and reacts while you are still living.
To do this, a living will becomes a separate entity in the eyes of the law and is assigned ownership of your estate. When a person creates a living will, they anoint a trustee that will overtake responsibility for managing the property. Often, that trustee is the estate owner in the first place. However, the trustee will name a successor trustee that will manage the property if the original dies. In this way, the successor functions similarly to the executor of a will.
What Should You Place in Your Living Trust?
The most common items people place in their living trusts are those with significant expenses:
- Real Estate or Housing
- Valuables or Artwork
- Precious Metals or Priceless Items
- Patents and Copyrights
- Stocks, Bonds, and Security Accounts
- Business Interests: Stocks, Partnerships, LLCs
Are There Different Types of Living Trusts?
There are two kinds of living trusts, categorized by their revocability:
Revocable Living Trust:
A grantor can cancel, change, or update this type of living trust any time after it is formed. That is why they are the most common types of living trusts. Removing or putting in more assets, naming new successors, removing old successors, changing guidelines, and selling off the property owned by the trust can be accomplished by simple amendments. Upon death, a revocable living trust converts automatically to an irrevocable living trust.
Irrevocable Living Trust:
It may seem obvious that you cannot change or cancel an irrevocable living trust once it is created. To change the terms, a judge’s order or an agreement by the original trustee and every beneficiary of the trust is required.
What Does “Per Capita” and “Per Stirpes” Mean?
While setting up your final wishes, you will want to pay close attention to the wording. If you or your estate lawyer uses the wrong Latin phrase, you may end up distributing your assets in a way you did not wish them to be.
“Per Stirpes” is a legal term that explains what happens in the scenario that the beneficiary, or all named beneficiaries, passes away before they receive the inheritance distributed in the will. “Per stirpes” means “of the branches.” Or, in this case, “down the branch.”
In the case of a per stirpes condition, if a beneficiary passes before they can take ownership of the contents of the original decedent’s will, the heirs of the beneficiary’s estate will receive the inheritance upon behalf of the intended beneficiary. Hence ‘branch;’ follows along, continuing the path of the family tree.
If a will is determined to be “per capita” or “by the head,” then the assets in the estate are distributed evenly amongst the surviving heirs. In this way, it is as if the estate comes directly from the “head” or the part of the branch where the decedent is listed, spreading outward evenly.
Do I Need a Living Trust or Will?
While it may seem like a thing of multi-millionaires and stuffy old-Hollywood films, having a proper estate plan to distribute your assets based on your wishes can be a life-altering thing for those you leave behind. And having the confidence in knowing that your family is taken care of and will not go through a long, costly ordeal where they may lose priceless family items can leave you in the right state of peace to continue living your life from now until your final days, confidently.
When you’re ready (and we always recommend sooner rather than later), give the lawyer team of Getz Collins and Associates a call at (403) 934-2500 to schedule a consultation regarding your estate plans.