A Will or a Living Trust? What Do I Need?

One of the most common questions we receive at Cutler | Riley Law is whether a person needs a Will or a Trust. The answer is relatively simple depending on what your goals are.

If you are not too concerned with making things easier and less costly for your loved ones upon your death, then a Will is all that you need. In other words, if your estate planning goal does not include the avoidance of probate court, then all you need is a Will.

However, for most people, they would like their loved ones to avoid having to go to probate court upon their death. If you fall into this category, then the way you can avoid probate court is rather straightforward as well.

What triggers Probate Court under Utah law?

Under Utah law, there are two scenarios where a decedent’s estate would have to go through probate court in order to be distributed to the decedent’s heirs or devisees.

The first is if the person died owning real property (i.e. is a homeowner) and there is no surviving co-owner.

The second is if the person died owning assets valued over $100,000 and those assets don’t already have a payable-on-death (“POD”) beneficiary designated with the financial institution that holds the assets/account.

You’ll notice that none of these scenarios have anything to do with whether or not the deceased person died with a Will. That is because a Will does not avoid probate court if either of these two scenarios apply.

A Trust Agreement can avoid Probate Court under Utah law

If either one of the two scenarios apply to you, then the answer to the question of whether you need a Trust is yes - regardless of how simple your home is or how big the outstanding balance on your mortgage is.

A Trust avoids probate court if you transfer your real property and valuable assets to your Trust while you are still living. This means that legally speaking, you no longer own your home, your Trust does. But don’t worry, you still have full control of your home and any other property you transfer to the Trust because you are the trust creator (aka Trustor, Grantor, Settlor, etc.) and also the “trustee”.

A trustee has the legal authority to manage trust property. In your Trust Agreement, you name a replacement trustee to take your spot when you die. This replacement trustee (aka successor trustee) then will then have the legal authority to sell your home and other assets without having to get the permission to do so from a probate court judge. This is how a Trust avoids probate court.

So if you’re looking to make things as easy as possible for your loved ones upon your death, and you’re a homeowner, then we recommend that you create a Trust. If you’d like a free consultation to learn more, and answer any other questions you have, please schedule a phone call or in person meeting with us!