An estate is comprised of everything you own such as your car, home, other real estate, bank accounts, investments, life insurance, furniture, jewelry etc. No matter the size of the estate, you can’t take it with your when you die. That is where estate planning comes in. To ensure that your wishes are carried out, you need to provide instructions that say whom you want to receive your assets.
Dying intestate is another way of saying you die without a will. If you die intestate, North Carolina’s default laws will determine who receives your property. North Carolina’s intestate laws are the legislature’s guess as to how most people would dispose of their estates. The North Carolina intestate laws may or may not reflect one’s actual wishes. A will, on the other hand, allows you to alter North Carolina’s default disposition rules to suit your individual preferences.
A will sets out your personal preferences for the distribution of your property that you own at the time of your death. With various exceptions, you may dispose of that property in any manner you choose. With a will, you may also designate a guardian for your minor children. By naming a guardian for your children, you are minimizing the court’s involvement in the care of your children if you and your spouse were to pass.
You cannot transfer non probate assets with your will. For example, a life insurance policy that is payable to a named beneficiary will pass regardless of your will.
Generally speaking, a trust is a contract whereby a trustee holds the property of the trust for the benefit of one or more persons called beneficiaries. The trustee is the legal owner of the trust property and the beneficiaries are the equitable owners of the trust property.
This is a trust that is created during one’s lifetime. A living trust can help you manage your assets and provide for you if you became ill, disabled or are otherwise unable to manage your assets personally. These types of trusts do not help you avoid estate taxes because they can be revoked or amended which causes them to be includable in your estate.