I recently had a client explain that they wanted a trust because Suze Orman said that everyone needed a trust. Now, in general, trusts meet many needs, and are often a good idea. Especially if there are minor children, adult children who might do better with structured payments, or long term care planning concerns, trusts can fill a valuable need. However, just as not everyone NEEDS a prenuptial agreement, not everyone needs a trust.
Trusts help you avoid much of the probate process, but there are other ways to do this, too. If your assets are jointly held with your spouse, and one of you dies, the assets will go “by operation of law” to your spouse without going through probate. In a similar way, anything with a beneficiary designation (life insurance, annuities, most retirement accounts) will go to that beneficiary directly. The probate court will oversee any assets that pass through your will, and sometimes this can be a good thing. It does take time to probate an estate, but if the assets are fairly limited, the cost of setting up a trust may not be appropriate.
Regardless of whether you do or do not need a trust, please call an advisor you trust before you make important estate planning decisions, I know that you aren’t cookie cutter clients, why should you have a cookie cutter estate plan?