How to Create a Trust in a Will

By Elizabeth Stock

It is possible to include a clause in a will to have your assets distributed to a trust upon your death. This kind of trust is called a testamentary trust. The creation of a trust through a valid will may have several benefits, including the avoidance of probate. In addition, if you want to leave a considerable amount of money to a minor, like your child, a testamentary trust can provide oversight. For a testamentary trust to be recognized as valid, the will must be valid.

Step 1

Create a valid will. To be valid, a will must be in writing, you must have the legal capacity to create a will and understand that the document you are signing is a will. Each state differs in terms of the number of witnesses required, but generally, at least one witness must observe you signing the will. For example, in Illinois, two witnesses must be present when you sign your will. For assistance in drafting a valid will, contact an attorney or visit an online document provider.

Step 2

Convey the necessary intent in your will to create a trust. For example, state in your will that upon your death you would like to have all or some of your assets transferred to a trust. It is usually not necessary to use specific language, but your intent to create a trust upon your death must be evident from a reasonable interpretation of your will.

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Step 3

Fund the trust with trust property. You will satisfy this element upon your death, but you must specify what property to include in the trust. In addition, you do not have to transfer all of your assets to the trust but can specify which particular items you would like to become trust property.

Step 4

Name at least one beneficiary of the trust. The beneficiary is the person the trust is created to benefit. Use the beneficiary’s full name in the trust and avoid using generic terms, such as “my family,” that can be interpreted several different ways, making the identity of the benficiaries unclear.

Step 5

Include a valid trust purpose. The trust’s purpose can include anything as long as it is not illegal. For example, you can create a trust for the maintenance of your spouse and children, or you can create the trust for the educational benefit of one of your children.

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The Pros & Cons of Making a Will

References

Related articles

Do Trusts Need to Be Notarized?

Whether a trust document needs to be notarized depends on its purpose and state law, but notarization is a requirement in many states. A notary public is commissioned by state or local governments primarily to certify signatures on documents ranging from wills and trusts to contracts. Beyond simply witnessing as you sign a document, the notary is charged with verifying your identity and making sure you are signing willingly and not under pressure.

Can a Revocable Trust Be Changed With a Will?

A revocable trust, or living trust, is an estate planning device that allows you to manage your property while you are alive and after your death. It is effective immediately after you execute it, and you can amend the trust during your lifetime. However, it becomes irrevocable at death. Although a will can add additional assets to the trust, it cannot dispose of the assets already in the trust or alter any trust provisions.

Amending a Testamentary Trust

To set up a testamentary trust, you include language in your last will and testament stating your intention to establish the trust. Because your will doesn't take effect until you're deceased, the testamentary trust can be amended before your death, usually by amending the will.

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