The differences between a Will and a Trust are simple, but the process of selecting the right pathway for you and your estate can be complex. Both are considered essential to a comprehensive estate plan but have major differences in how they function.
The key differences between a Will and a Trust that you should consider are:
A Will is effective only after your death and does not have the authority to manage your property if you become incapacitated. A Trust can take effect during your lifetime as well as after your passing. A Trust can be used to manage and distribute your assets before death, immediately after death and into the future.
Probate and Privacy:
A Will requires validation through the court’s probate administration process. The state’s court must confirm your will and allow your executor to distribute assets per your Will’s instructions. This can be a long and sometimes costly process. In addition to drawing out the process of transitioning your assets to your beneficiaries, all Wills are subject to becoming public record, which means anyone is about to see the details of your Will. If you wish to keep your estate private, a trust could be a good solution as it does not become subject to public record.
Complexity and Cost:
A Trust typically requires more paperwork and, therefore, can initially be more costly than a Will to establish. But, avoiding probate costs that a Will is guaranteed to incur, a Trust may be a worth-while investment. On the other hand, because of the cost and complexity of a Trust, it may not be updated regularly.
Both Wills and Trusts are legal documents but are created under different laws. Trusts, which fall under Contract Law, are held to a stricter standard than Wills, which fall into Testamentary Law. Typically, because of this a Trust will trump a Will.
Choosing between a Will, a Trust or a combination of both can be a headache. Let Russell Law Offices, S.C. help you choose the right pathway for you and your estate. Call to schedule a consultation today!
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