If you are considering creating your estate plan to achieve peace of mind for you and your loved ones, you may wonder about the key difference between a trust and a will. When individuals consider setting up their estate plan, they most often plan for their eventual passing.
Both will and trust documents help plan for the future and protection for you and your family. Still, there are other considerations for how your estate plan can be of benefit while you are still enjoying life with loved ones. To help you better understand, we’ve broken down California trusts and wills below, as well as the difference between the two.
When you establish your will, also known as a Last Will and Testament, you establish legal protection for your property upon your passing. A will also enables you to make your wishes known for burial arrangements, designate your beneficiaries, and specify which pieces of property should go to which individuals.
This legal document allows you to designate an executor to ensure the terms that the will established are followed. You can also appoint guardians for your minor children and other dependents. Doing so can help give you peace of mind that your loved ones will be cared for should anything happen to you.
Your will is established once you have signed the document before witnesses and a notary, who must also sign.
There are several different types of trusts that can be established, with revocable living trusts being one of the most common. An estate planning attorney can advise you on which trust may be best to achieve your goals and ensure your wishes are met. For the sake of this article, we will focus on discussing setting up a living trust.
A revocable living trust is an effective tool for protecting your assets, not only upon your passing but also while you are still living. The person who creates the trust is known as the trustee and is able to access and manage the trust assets even while living.
When establishing a trust, you must appoint a successor trustee who will handle the trust administration upon your passing. This task will include distributing your assets according to the terms of the trust.
If you were to establish a trust other than a revocable living trust, you would need to choose a trustee other than yourself. This person will be responsible for managing your assets, which would limit your control. This is what makes a living trust such a common choice for many.
Trusts vs. Wills in California: The Primary Difference is Avoiding Probate
If you are wondering about the difference between a revocable living trust and a will (even a will that outlines the creation of a testamentary trust upon passing), it comes down to the benefit of avoiding the probate process. Once a will is filed with the probate court, it becomes available in public records. Beneficiaries must also wait for court approval to access the assets.
A revocable living trust allows your loved ones to avoid going to the probate court if you properly funded them into the trust before passing. This will enable beneficiaries to access the assets without waiting for court approval.
Should You Have a Trust, a Will, or Both?
When deciding what sort of estate planning documents you need, an attorney is the best person to advise you. Each person’s estate plan is uniquely tailored to their needs, whether it is outlining their wishes, asset protection, or reducing estate taxes. At The Legacy Lawyers, we work hard to assist our clients with creating an estate plan that achieves their goals. Call us at 800-840-1998 to begin the estate planning process.