What is the difference between a will and a trust?

Key Differences Between a Will and a Trust

As a lawyer, I can explain the key differences between a will and a trust:

Definition:

A will is a legal document that outlines how a person’s assets will be distributed after their death. It becomes effective only upon the death of the person who created it. A trust, on the other hand, is a legal entity that can be created during a person’s lifetime or upon their death, which holds property for the benefit of one or more beneficiaries.

Process:

The process of creating a will is relatively straightforward. You need to be of sound mind and legal age, and your signature must be witnessed by two people. However, after your death, your loved ones must go through probate court, which is the legal process of administering your estate according to your will. This process can be lengthy, costly, and can tie up assets for months or even years. In contrast, a trust avoids probate court as it is a separate legal entity that continues to exist after your death. Your assets are owned by the trust, and after your death, the trustee can distribute the assets according to your wishes with minimal court intervention.

Privacy:

Wills are required to be filed in probate court and become part of the public record. This means that anyone can view the contents of your will, including the assets you owned and who received them. In contrast, trusts are private documents that are filed with the court only if litigation arises.

Flexibility:

Wills provide flexibility, as they can be easily modified and updated as your personal and financial circumstances change. This can include changes to your assets, beneficiaries or even wishes itself. A trust, on the other hand, is relatively inflexible after your death. If you want to modify the trust, it needs to be done beforehand.

In summary, a will is a document that outlines how a person’s assets and other affairs will be handled after that person dies. A trust, on the other hand, is a legal entity that can be created during a person’s lifetime or upon their death, which holds property for the benefit of one or more beneficiaries. While both serve the purpose of distributing your assets after your death, trust can often be a more effective and efficient way of doing so since it can potentially bypass probate court and minimize taxes.

I would recommend consulting with an attorney to discuss further which option is best for you based on your personal circumstances.