While many people are familiar with the concept of a last will and testament, fewer are familiar with the uses and benefits of a trust. Both are useful and complementary estate planning tools you should be aware of. Below is a discussion of what they are and how they differ. 

3 Differences Between Wills and Trusts

1. Administrators

The people who administer your instructions are different, depending on whether you have a will or trust.

With wills, you choose an executor or personal representative. This person represents your estate, pays your remaining bills, sells property as needed, and generally ensures that your wishes are carried out.

With a trust, you name a trustee who manages your trust for the benefit of the beneficiary. They make investment decisions, submit beneficiary payments according to your instructions, and have a fiduciary duty to make prudent decisions regarding the assets of the trust.

2.. Public vs. Private

A will is a public document that tells the court how you want to distribute your assets after your death. In it, you explain who receives which parts of your estate. You also name an executor or personal representative to handle the sale and distribution of your assets. This process takes place under the supervision of a probate judge and therefore becomes part of the public record.

Unlike a will, the contents and beneficiary of a trust are entirely private. The document does not go through probate, and outside parties are unable to look up the relevant records.

3. Date of Transfer

While a will transfers property only after your death, you can transfer property with a trust at any time — before, after, or at the time of death. Simply instruct the trustee when you wish to do so. For instance, you can have the trustee wait until your beneficiary’s 21st birthday or portion out amounts each year for decades.

To get your financial affairs in order, contact estate planning expert Randy L. Cranford Attorney at Law in Thomasville, NC. He and his team have been serving clients in and around Davidson County for more than 30 years. In addition to estate planning, they also specialize in disability law, social security, workers compensation, personal injury, criminal defense, and family law. Learn more about their services online or call (336) 476-3115 to make an appointment.