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A will or a living trust will allow you to transfer your financial assets according to your wishes to family members, friends, and charitable organizations.

Anyone with financial assets should have a will or living trust. Without it, you will be said to die “intestate” and a county judge will appoint an executor to distribute your assets. The county will charge your estate for the work it does in distributing your estate.

The county government will follow the laws of your state to determine who should receive your assets. Generally your estate will go first to your spouse, then your children, then parents, and finally to other close relatives.

Last Will and Testament

In many cases, a last will and testament is sufficient for distributing your estate. You can have an attorney prepare your will documents, or do it yourself using a trusted software program. You must sign and date your will in the presence of two witnesses. One disadvantage of a will is that it must go through a process called probate when you die. The probate process takes time and costs money, plus the details of your will become a public record.

Living Trust

If you have a larger estate with a wider range of financial vehicles, then a living trust may be preferable. After setting up the trust, you will be able to transfer most types of assets into the trust. As a trustee, you have control over those assets.

When you die, these assets can be transferred to whomever you have named as beneficiaries of the trust, without needing to go through probate. A living trust can also offer tax advantages to a married couple when the first spouse dies.

Direct Transfer of Assets

There are assets that can be transferred directly to another person without a will or living trust. This is called direct transfer of assets and can be used for your bank accounts, brokerage accounts, retirement accounts, and real estate. In a few states, you may also transfer registered vehicles.

Immediate Access to Accounts

If you want your spouse or another trusted person to have immediate access to bank and brokerage accounts at your death, then make sure that both of your names are listed on these accounts as “Joint Tenants with Right of Survivorship.”

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