People in Pennsylvania may acquire various property throughout their lives. It can come in many different forms. People may own homes and other real estate property, bank accounts, retirement accounts, vehicles, collectables, household goods and many other types of property. While the property has various purposes throughout life, all property has something in common and that is that it cannot come with people when they pass away.
The property will be passed on to people who are still living and that is why it is important that people go through the estate planning process. This process gives people control over who will receive their property. This is important because if they do not have a will or a trust, the property will be given to people according to the intestate laws. This is not always what people want though. Having a will or trust gives people control over that aspect of the process.
Wills and trusts both transfer property to certain beneficiaries, but there are differences between them that people should understand before choosing to use one or the other.
Differences between wills and trusts
Trusts allow people to transfer ownership of their property to the trust while they are living. They become effective immediately and once property has been transferred people no longer have ownership of that property. If it is a revocable trust people do maintain control over the property though and can continue to use it while living. In death, trusts allow people to avoid probate and assets are immediately transferred by a trustee. This also allows people to keep the process private.
Wills dictate where people’s property goes when they pass away. These only become effective once people pass away and property is never transferred to the will while people are living. The property in a will still needs to go through the probate process though, which is a public proceeding. Drafting wills is usually a cheaper, less complicated method.
It is important that people in Pennsylvania plan for their passing. They have different options and consulting with experienced attorneys could be beneficial.