Building a lasting legacy: Selecting the right tools for estate planning

livemint.com:

Last will and testament: Commonly known as a will, it is a fundamental yet crucial component of your estate plan. It allows you to specify how your assets should be distributed after your passing. This document empowers you to allocate your assets according to your wishes, whether it’s to family members, friends, or charitable organizations.

A significant advantage of a will is that it supersedes intestate succession laws, which means you have control over who inherits your assets and in what proportions. Additionally, you can modify your will as needed throughout your life, provided you remain mentally competent. However, it’s important to note that wills can be contested, especially if your estate planning focuses solely on drafting the will without ensuring that all relevant asset documentation aligns with your intentions.

Private family trust: A trust is another powerful tool in estate planning, and it can be established during your lifetime. Trusts are versatile and can serve various purposes. Unlike a will, which distributes assets posthumously in a single instance, a trust can manage and allocate assets both during and after your lifetime.

Trusts offer several advantages, such as facilitating succession planning, protecting assets from unwarranted claims, preserving assets for minors or individuals who may not handle finances responsibly, and managing wealth for beneficiaries who might not be financially savvy. Trusts come in various forms, including revocable, irrevocable, discretionary, and determinate trusts, and the choice depends on your specific objectives and circumstances. Gift deed: A gift deed allows you to transfer assets during your lifetime from you (the donor) to the recipient (the donee).