As we begin the fall season, we may find ourselves reflecting on our summer and the many memories we had the chance to make with family and friends. If you are one of the lucky ones, you may have enjoyed some wonderful family time at your vacation home where you made lasting memories with your children and grandchildren. It may be a favorite family tradition to spend a week, or a few weekends, every summer with your family at your vacation home. This may be a tradition you want to preserve and ensure that even when you pass away, your family will be able to continue creating lots of family memories for many years to come.
You may now be wondering how you can ensure that your family vacation home will stay in your family, even after your death. Fortunately, you have a couple options to help protect your family vacation home in your Estate Plan, including leaving your vacation home in your Will or your Trust. Here at Trust & Will, we want to help you make the decision that is right for you regarding your family vacation home. Below, we will go over each option and some of the benefits and drawbacks of each, ensuring that you can make an informed decision that best fits your family’s desires.
Leaving Your Family Vacation Home in Your Will
A Will is a document that allows you to designate who will receive your assets when you pass away, which can include anything from jewelry, to cars, to family vacation homes. When you leave your family vacation home in your Will, you will have to name a beneficiary, or beneficiaries, to this asset.
Benefits of Leaving Your Family Vacation Home in Your Will
One of the benefits of leaving your family vacation home within your Will is that it allows you total control over who retains ownership of the house and property in your absence. This gives you the ability to ensure that your family vacation home will stay within your family, allowing your family to make many more memories to come within the home.
Wills also can make the transition of your assets smoother, as there is a written account of who you wanted to inherit the home. This will save time in the long run of transitioning ownership once you pass.
Drawbacks of Leaving Your Family Vacation Home in Your Will
The biggest drawback when choosing to leave your family vacation home within your Will is that regardless of whether you name a beneficiary, your vacation home will still have to go through probate court, which is where all assets are transferred, and affairs settled after the death of an individual. This is a costly and time-consuming process, as it requires a lawyer to be hired to help transfer all assets. This process can often drag on for many months. However, the fact that you included your family vacation home within your Will does help speed up the process and make the transfer easier.
An additional drawback is that when your assets must go through probate court, they cannot be used while it is determined who is the rightful new owner of the asset. This means that while your affairs are being settled in probate court, your family vacation home cannot be used by your family members. This could keep your family from making lasting memories for a significant period of time, causing them to possibly miss out on an entire summer of fun.
Leaving your Family Vacation Home in Your Trust
A Trust, often a Living Trust, is an agreement that allows you to have your designated assets managed by a third party, known as your Trustee, under your specific instruction. When you die, your Trustee will become the sole owner of the assets responsible to them. Once putting your family vacation home within a Trust, you will need to select an individual to be your Trustee. To keep your vacation home within your family, you will want to name one of your family members as your Trustee within your written Trust.
Benefits of Leaving Your Family Vacation Home in Your Trust
Like Wills, one of the benefits of leaving your vacation home in your Trust is that you will have total control over who will become the owner of your vacation home once you pass away, ensuring you can keep the home within the family.
The most significant benefit of leaving your family vacation home within your Trust is that it allows you to avoid probate court altogether. This will save you a substantial amount of money in legal fees and save your family time. Due to this seamless transfer, your family will also be able to use the vacation home sooner and not have to wait for probate court proceedings to conclude.
Drawbacks of Leaving Your Family Vacation Home in Your Trust
A potential drawback of placing your family vacation home within a Trust is that while you are still living, you are no longer the primary owner of the vacation home, instead you will work through legal documents to express how you want your vacation home managed. This can be seen as inconvenient to some people.
Another disadvantage of a Trust is the expense you will incur to set one up. Trusts can often be a costly process, especially if you must work with a lawyer to set one up. This is where Trust & Will can help you, as we are determined to reduce fees and make setting up Trusts easier using our convenient and affordable online estate planning services.
Deciding what option is right for you when leaving your family vacation home to loved ones can be a hard call to make and creating the Estate Plan itself is a whole other hurdle. If you are unsure where to start, please take our free online quiz to point you in the right direction!
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