Will vs Living Trust: What’s Best for You?

When you think of estate planning, you may think that the only step involved is making a will. However, there are additional aspects of estate plans that can help you protect your family’s best interests. One of them is a living trust.

A living trust offers numerous benefits that you can’t take advantage of if you rely solely on a will. Continue reading to learn more about the benefits of a living trust vs a will, and what the main differences include.

What Distinguishes a Will From a Living Trust?

There are several differences between a will and a living trust. For example, a trust is a legal document that becomes effective immediately upon its creation. A will only takes effect after the individual who drafted it has passed away. Although these two documents serve distinct functions, they complement each other to form a comprehensive estate plan.

A will clearly outlines the distribution of your property and finances, and it specifies who will inherit them. It also designates a legal representative responsible for ensuring that your assets are allocated according to your wishes. Assets pertain to all property registered in your name, excluding any that have been transferred elsewhere. Additionally, a will allows you to appoint guardians for minor children and detail your funeral arrangements.

In contrast, a living trust is a document that lets you protect and distribute assets prior to your death. With a trust, you can designate a trustee. This is the person or organization that holds and manages property in the trust for your beneficiaries.

A trust allows you to name yourself as the trustee, giving you complete control. You can also name someone else as trustee. When this happens, the law imposes a duty on that person to manage your property according to the guidelines of the trust. Only property that has been specifically transferred into the trust is managed under its terms.

What Are the Benefits of a Living Trust Over a Will?

Both a will and a living trust can specify how you would like your property distributed after death. However, a living trust also offers certain advantages that a will does not.

First, a trust provides you with more flexibility than a will in how you distribute your property. You can add provisions that specify when and how beneficiaries receive or use money and other assets. For example, you can specify that money from the trust must go towards educational expenses.

Secondly, you’re able to avoid probate. Probate is a legal proceeding for wills where a court ensures that your will is valid, the estate’s debts are paid, and your property is distributed according to the will’s terms.

The probate process is long and often expensive, thus decreasing the value of your estate. Trusts allow you to skip this process. When you die, your property is distributed according to the trust document without the need for probate.

Since there is no need for probate, trusts allow you to keep your estate matters private. Probate proceedings are a matter of public record, so nearly anyone can obtain information about your estate. Trusts can also help you to reduce or even avoid estate taxes.

Finally, a trust allows you to prepare for potential disability. A trust can provide a seamless framework for managing your affairs if you become incapacitated. In such cases, choosing a successor trustee ensures smooth asset management without the need for court approval. This maintains privacy and flexibility in your financial matters.

The Importance of Wills and Trusts

Many estate plans use wills, trusts, and other documents to create a complete strategy for managing assets. The best approach depends on individual circumstances, goals, and state laws.

In the absence of a will, your assets will be distributed to your heirs according to the laws of intestate succession. To ensure that your property is passed on to your beneficiaries as you intend, a carefully drafted and executed will is crucial.

While a will names the recipients of your assets, trusts are instrumental in preserving those assets. By utilizing trusts, you can ensure specific assets are set aside for beneficiaries without court involvement. You can also safeguard the management of your affairs if you ever become unable to do so because of illness or injury.

Contact Our Law Firm Today

For members of the LGBT+ community, protecting your assets and end-of-life decisions is incredibly important. Our skilled estate planning attorneys can recommend the best way to ensure your wishes are honored before and after your passing.

At Metz & Jones LLC, we’ll help you navigate the estate planning process. You can rely on us when you’re ready to create a revocable living trust that will protect yours and your loved ones’ best interests.

Contact our LGBT+ wills and trusts attorneys today to schedule an appointment. We’re here to help you understand your estate planning options.