There are many reasons why people set up a trust. They want to keep control over their assets, or they do not wish to send an inheritance to their children through probate. There is another reason to consider a trust. You may want to draw as little attention as possible to your estate after your death.
While privacy is a concern for some families, making out a will is often not the best option to keep estate plans private. Wills and trusts have differing levels of exposure to the public.
Wills and privacy
After your death, your will becomes part of the public record. This means that anyone can acquire a copy of your will. People can learn who your heirs are, what they will inherit and your requirements for your beneficiaries to inherit. This is not a problem for many families, but if privacy is your priority, you cannot count on your last will and testament to assist you.
Trusts and privacy
As Kiplinger explains, a trust offers you more privacy because it is a private agreement to distribute whatever assets reside in the trust. As a result, nobody can look into public records to find a copy of your trust documents. By setting up a trust, you may keep your beneficiaries and assets contained in your trust confidential.
Pour-over wills and privacy
You may have drafted a pour-over will to place whatever assets remain in your estate upon your death into your trust so they will be there to distribute to your heirs. However, a pour-over will does not remain private. Like other wills, an executor must file it with the court, so your pour-over will can become public record.
In spite of public exposure, a pour-over will is important to have since it will make sure you fund your trust with whatever assets remain in your estate if that is what you wish. To assist your privacy concerns, you may assign your more sensitive assets to your trust while you are alive so that your pour-over will does not have to deal with them.