Wills and Trusts are both important estate-planning methods, but are different. A Trust is established when you sign the Trust. A Will is not activated until your death. Upon your death, only a Will goes through the probate process. Some other differences are the following:
- A Will is usually less expensive to prepare than a Trust
- A probate of a will is usually more expensive than the administration of a Trust
- You have to follow more legal formalities to set up and manage the Trust
- A will is filed with the Court and is public. A Trust is private
- Usually the distribution of assets is accomplished sooner with a Trust administration compared with a probate
- By publishing a notice to creditors in a probate process, most creditors are precluded from making a claim after a certain period of time
- A Trust is usually preferred for an estate that has a significant value that may be subject t to state and federal estate taxes
An attorney can assist in determining whether a Trust or Will accomplishes your estate planning goals.