The most common – and usually confusing – question clients have asked during my 20+ years of estate planning experience is: “What is the difference between a will and a trust?” But also, “Are a will and a trust the same thing?” and “Does it matter whether I have a will or a trust?” No matter the question, comparing these two estate planning tools can be confusing! So let’s get to adulting, tackle the issue, and break down differences between a will and a trust.

 

A Will: Your Directions Page for the Probate Court

A will is a lot like what you have likely seen on television: a document that directs how, and to whom, you want your property to pass after you have died. You get to name the person in charge of getting your stuff to the correct people (your Executor), and you can make your will as straightforward and simple – or as long and dramatic – as you wish. Your will is also where you nominate long-term guardians for any minor children. Think of your will as your final shout-out, your final directions page; it only applies after you have died, and you get to let everyone know where all of your stuff goes.

The catch? A will is just the directions page for the probate court. Your family will still need to go through a probate administration, even with a will. It is a common misconception that having a will ensures your loved ones will avoid the probate court.

“Why does my dad’s property have to go through the probate court? He wrote a will telling us how he wanted his property to pass, so the court does not need to be involved!” (Sound familiar? I used to hear this regularly). But really, where there’s a will, there’s likely probate, and the will is the instructions for the probate court.

So – a will can be very straightforward, simple, and inexpensive to state your wishes and directions. However, the will only applies after your death, and your family would likely be required to navigate through the probate court process to honor the terms of your will. And the probate process can be a long, tedious, and expensive process, depending on the amount of property, family drama, and unexpected delays involved.

 

A Trust: Your Private Plan for Your Property and Loved Ones

Here, when I refer to “trusts,” this is short for revocable living trusts. That’s a mouthful, right? But this is actually what the trust is – revocable while you are living; it is simply another estate planning tool. Let’s think of a trust as a will replacement.

Ideally, if you have a revocable living trust, your family will never need your will (other than for guardian nominations). How it works: first, you draft your trust while you are living, and you are the trustee of your own trust…. So think of your trust as your favorite bag that holds all of your “stuff” (your home, personal property, businesses, financial accounts, etc) while you move through life. While you are alive and well, and you are the trustee of your own trust, everything stays the same; you have full control over your trust and all the property within it. But if you die or become incapacitated, your trust (with all of your stuff in it) can seamlessly pass to the person you’ve named to be your Successor Trustee, who can manage your trust in your place.

Having a revocable living trust means that there will be no probate court administration when you pass away. 

Why? Because all of your property is already inside your trust. So when you die, that property is still in your trust; the only thing that changes is who is now the trustee. During a time of crisis – after death or if you become incapacitated – your Successor Trustee can step in smoothly with no delays or court intervention to follow your instructions as to how, when, and to whom your property shall pass.

Your trust is also a private document, so the manner in which your Successor Trustee distributes your property is no one else’s business, as opposed to a probate administration, which is a public proceeding, and anyone can see how much, and to whom, your probate property passes. And Successor Trustees can administer your trust from anywhere, at their own pace, and not subject to probate costs, delays, or court schedules.

 

Deciding Which Route Is Best For Your Specific Needs

So which document will work better for you? This really all depends on how much of your property would go through the probate process, how much control you want over the distribution of that property, and how simple and inexpensive you want things to be for you right now versus how comfortable you are with things perhaps being complicated and expensive for your family in the future. Wills are a straightforward, easy solution for a simple estate without a lot of “hiccups” anticipated. Trusts are ideal if you have family dynamics and/or assets which you would like more control over how, when, and in what matter they are protected and passed to your loved ones. If you want to ensure your loved ones have as little stress or difficulty in managing your property – and you are willing to do a little more work now to facilitate this – a revocable living trust may be your best option.

But the most important step to take is to start your estate plan by discussing your goals, assets, and family dynamics with an experienced estate planning attorney. Book a call with me now by clicking the link below.