Will or Living Trust: which is better? A Will usually requires probate, but can gather assets upon death. A Trust does not require probate, but you should convey assets into Trust during life.
We will consider some basic ways a Will and Trust differ:
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When I die, ___ goes to my ___.
So, assets I owned in my sole, individual name are subject to being probated, per terms of my Will.
I name my spouse as Executor, and maybe my oldest child as backup, to administer my estate.
Then, my Executor hires attorney for Probate (court-supervised administration; likely takes several months – sometimes 4 months just for creditor waiting period).
- Court accepts Will for probate.
- Court formally appoints Executor.
- Executor files inventory.
- Then, the Executor gives notice by publication and directly to heirs and creditors.
- Waiting period to give opportunity for creditors to file claims against estate.
- Court supervises more or less, depending upon type of probate.
- Executor accounts for and distributes assets with Court approval.
- Finally, the Estate is closed.
- When I die, my spouse has continuing control and use of all assets.
- After spouse dies, then assets applied for care of kid(s) so long as minor(s).
- Assets are available for post-secondary education for kids(s).
- And, remaining assets go to kid(s) at age 22, 25 and 30.
Now, when I sign a living trust, I’ll title major assets into my Trust (a Trust does not gather assets into it automatically but you may have a backup “Pourover” Will to move forgotten assets into your Trust).
Trust administration usually means:
- Minimal notice goes to beneficiaries and accounting (per state statute).
- Trustee manages and distributes assets of trust.
- Court need not supervise.
- Proceedings are not filed or public.
- Trust provisions control how Trustee may act.
- Trustee owes duty to beneficiaries.
So, please note that this is, of course, general advice. You should get attorney advice for your specific situation.
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