Both wills and trusts are legal documents designed to transfer assets to beneficiaries under specific terms. The terms of these instructions may not be acted upon until your death, but they can be changed under your direction while you’re living. While both tools are valuable for estate planning, they each present different advantages and disadvantages. To help you determine which option is best for your needs, consider this comparison of wills and trusts.

Brief Comparison of Wills and Trusts

What is a Will?

A will is a signed and witnessed document that’s typically prepared by a skilled attorney. The document should outline instructions on how you want to divide your assets among specific beneficiaries. You can also provide instructions on how these assets are bequeathed, such as naming a specific time for the transfer. Most wills name an executor, an individual who will be in charge of the property transfer process.

Wills can accomplish a few things that living trusts cannot. Specifically, they can name guardianships for minor children and provide instructions on how to cover taxes and debts. If your estate is organized in a fairly straightforward manner, devising a will may be preferable over a trust, as it tends to be less expensive and time-consuming to arrange.

It is important to note that the transfer of property may require your beneficiaries to go through probate court. California’s general rule is that estates valued over $150,000 must go through probate.

What is a Trust?

A living trust is a notarized document designed to manage property, including those assets transferred to beneficiaries, during your lifetime and after your death. While you can act as your own trustee (the individual managing the document), you will need to name a successor who will handle these matters upon your death or incapacitation.

This option is usually preferred by those who want to take a more hands-on approach to estate planning. However, compared to a will, living trusts require more upfront time and money to create.

In terms of advantages, trusts do not require assets to be transferred through probate court. As such, it’s ideal for those who want to transfer high-value property in a quick and discreet manner.  

 

 

Now that you understand the importance of wills and trusts in estate planning, My Legal Team Inc. in Signal Hill, CA, can provide you with the guidance you need to fully explore these options. Serving the Los Angeles County area, they handle estate and family law, in addition to other legal areas. To learn more about their skills and how they can help you save on expenses, visit this law firm online. If you’d like to schedule a convenient legal consultation, call (562) 479-0900.