Regardless if a trust is involved in your estate plan, you will likely have a Last Will for the following purposes:

• Naming guardians for dependents
• Distributing personal assets without designated beneficiaries nor in a trust
• Naming executors to handle distribution of assets not in a trust

Having a Last Will and Testament does not prevent probate. Testamentary Trusts, created by a Last Will after you pass, do not help assets avoid probate either.

First, probate is not a tax. Probate is the process to ensure your Last Will and Testament's instructions are followed and debts repaid. If you die without a Last Will, your state has a default Last Will for you, which will be used in probate for your estate.

The process can be simple for small estates but the process can be complicated and involve the use of an attorney. That's when probate can become expensive. It is not unheard of probate and attorneys reducing the estate by 3%-10%. The length of probate in Arizona averages between 6 and 18 months.

For both families with young children or adult children, quick access to assets may be necessary. Assets in a Living Trust can legally avoid probate, making assets available quicker.

Trusts typically stay in force the duration of the beneficiaries' lifetimes. This feature fulfills many estate planning objectives.

Are your beneficiaries ready for an inheritance? Trusts can hold assets until certain benchmarks are reached, typically a responsible age. Money can be distributed prior to a designated age for reasonable education, health and support needs, as deemed by the Successor Trustees you appoint.

Your executor's job can be made easier. No Contest Clauses typically disinherit anyone legally contesting the estate, which with a Last Will alone can freeze an estate for years.

Trusts can maintain a residence for children & their guardians. Mortgages, taxes and expenses can be paid from your living trust until children finish school, at which point the property can be sold and distributed.

A trust can help special needs beneficiaries receiving disability income. An inheritance may interfere with their payments so a trust can withhold their share unless a distribution is needed.

Trusts can maintain a residence for a spouse in a blended family until he/she no longer resides in the real estate owned by the trust.

Married couples can double their estate tax exemption. If your estate (including life ins) is under $2M in '08 or $3.5M in '09 there's little worry for estate taxes. Portions of estates over that limit are subject to hefty taxes of nearly 50%.

Your trust can only control assets in its possession. Your goal is to transfer appropriate assets into your Living Trust while you are living. Don't worry, you maintain control of assets in your living trust if you are the initial Trustee.

Assets typically transferred to a trust: Property, bank accounts, non-qualified investments, vehicles and non-titled assets such as furniture, art, jewelry, etc.
Assets not in the trust but naming the trust as a beneficiary: Life insurance, annuities
Assets kept away from the trust: Tax-deferred accounts