For certain needs, preferences, and privacy, an Oregon trust is best

When we mention an Oregon trust, the assumptions begin:

“Trusts are just for rich people.”

“My will does everything already.”

“I couldn’t possibly need another estate document.”

Here’s the thing, though: wills and trusts are not interchangeable. While a will is an essential part of most estate plans, a trust can be far more important not only for your circumstances but also for potentially having some assets pass outside of the probate process.

The real decision isn’t whether you need either an Oregon will or a trust. It’s understanding what each does, and whether you need both.

What an Oregon will does for you and those you provide for

Your will is the foundation of your estate plan. It’s where you can specify important wishes and preferences, including:

• Naming beneficiaries
• Appointing an executor/personal representative
• Names guardians for minor children
• Can be more prone to legal challenges

At a minimum, a will is a must for specifying who you would like to be the guardian of any minor children.

As your life and preferences change, you can also replace your will with a new one at any time.

Otherwise, your Oregon will is there, but it has no legal effect until after your death.

The stressful part of a will? A will must go through probate, and probate is a public process. Plus, in Oregon, probate typically takes around 7 months to conclude. It can finish up in as little as five months, but taking over a year also is not uncommon.

A will is essential. For many situations, you might be just fine with only a will. However, when the circumstances are right, a trust can mitigate the challenges that come with a will.

What an Oregon trust adds

Trusts can provide a variety of benefits, such as:

• Managing the distribution of assets
• Long-term planning to benefit minor children or other beneficiaries
• Trusts do not pass through probate, so they remain private
• The terms of the trust can begin fulfillment immediately
• Less likely to be challenged in court

However, a trust isn’t just for beneficiaries. Trusts can manage and distribute assets after your death, but also while you’re still alive, if that’s what you want. Through the trust, you can also exercise control over how and when beneficiaries receive assets.

Many people like to use trusts to manage what must go through probate. As long as the trust holds title and ownership of the property, the trust can manage and distribute that property, instead of having to go through probate.

Privacy is another key benefit, and one of the most popular reasons people use an Oregon trust in combination with their will. No public court records protect privacy and can prevent disagreements, problems, or feuds.

Plus, a will only takes effect on death. A successor trustee can step in to manage the trust not only in the event of your death but also your incapacitation.

Your will manages property you own. In order for the trust to manage assets, the trust must be funded. In other words, the trust must be assigned ownership of the asset (such as real property being titled to the trust, not to you).

Why most people end up needing both

Wills and trusts are not either/or documents. They are partners. Each is best suited for different circumstances that the other is.

For example, while you can assign property to the trust, not everything will fall under the management of the trust. Typically, trusts pair with a “pour-over will.” For anything not titled into the trust and managed by the trust, the will steps up and specifies what’s happening to those assets.

A trust cannot name a guardian for minor children. Only your will can do that. However, the trust can hold assets that are used for the benefit of those minor children, and the trust can set out terms, age thresholds, or certain life thresholds that manage how assets are distributed to those children.

Wills are typically more like a onetime event. They’re completed, they’re enacted upon death, they’re reviewed and concluded as part of probate. The estate is settled, things are paid out or distributed, and the will is done.

Trusts are typically ongoing. Some trusts might be processed, administered, and wound up after death, but many trusts continue for the long-term.

When your will passes through probate, it will take time. But upon completion, the terms typically become fulfilled. Property and assets can be distributed. Minor children can go to their guardian. The terms of the trust continue as defined, based on your wishes and preferences.

If both a will and a trust benefit you and those you wish to provide for, it’s just a question of how to use each instrument best for your situation.

Signals you may need a trust, not just a will

Not every estate needs both a will and a trust. Here are a few signs a trust makes sense for your estate plan:

• Own real property in more than one state
• Blended family
• The beneficiary situation has complications
• Special needs beneficiary
• Seeking options for incapacitation without involving a court
• Prefer to keep more of the estate private and out of public knowledge

Wills and trusts aren’t powerful tools in your estate

A will is your bare minimum for an Oregon estate plan. Whether a trust makes sense depends on your situation. If you already have a will, but it’s time to update your estate, now is also a good time to check on how well your will reflects your life and preferences. If you haven’t used a trust before, you and your Oregon estate attorney can always set up a trust and match a will to work with it.

Ready to talk over what’s right for you?