For most of us, thinking about death and planning for a time for when you are no longer around is an uncomfortable thought. But the truth of the matter is that if you don’t take certain steps to protect your assets before that time comes, the ones you hold most dear may not receive the property and assets you would want them to have. Dying intestate means that your property and financial assets get divided up among your remaining relatives by the laws of intestate succession for the state you reside in; instead of you directing how they should be distributed as in a will or putting them into a living trust with beneficiaries. Even if you’re single with no living relatives, dying intestate means your property could end up going to the state in which you reside at your death.
Living trusts and wills are two estate planning options designed specifically to help you prepare for the inevitable. You have probably heard the term but are still wondering, “What is a living trust?” and how does it differ from a will? The main difference between a living trust and a will is that one focuses largely on the management of your assets while you’re alive, and also after death, the other focuses solely on the distribution of your assets after you’ve passed away. A will is a legal document that informs who receives your property and assets when you die and appoints a legal representative to ensure your instructions contained in the will get carried out, whereas a living trust can start distributing property and financial assets as soon as it gets established.
Avoiding probate: Arguably the biggest benefit of creating a Trust is that your heirs will avoid the probate process. Probate is the legal process that happens after someone passes away that had a will. The will gets reviewed in probate court to prove its validity. However, a living trust is not subject to the probate process, and so any property and assets sitting in the trust go straight to your heirs without the costs and lengthy delay that can be typical of probate.
Privacy: As a living trust passes outside of probate, a court does not need to oversee the process, which can not only help to save time and money, but it also means it is not a matter of public record and, therefore, the details of the trust remain private.
Mental incapacity: Another key difference is that a will doesn’t plan for mental disability because it only goes into effect after the testator passes away. In the event, a person becomes mentally disabled, a family member would need to appeal the court to ask that a conservator or guardian be appointed which can be both costly and stressful. With a living trust, provisions for disability can be written into a revocable living trust.
Different types of trusts: There are different types of trusts available, and while the state of Texas does not require legal administration of an estate or for probate hearings, it is wise to seek counsel during what is a difficult and emotional time. While courts are sympathetic to families dealing with the loss of a loved one, they are unable to offer legal advice prior to or during the proceedings. That’s why families have turned to Wilson Brown, PLLC, for more than 30 years to help them with their San Antonio estate planning needs.
Wills and trusts advantages and disadvantages: both wills and trust have their advantages and disadvantages. For example, a will allows you to name a guardian for children and to specify funeral arrangements, while a trust does not. On the other hand, a living trust can plan for disability and can provide savings on taxes. The San Antonio estate planning attorneys at Wilson Brown, PLLC can tell you how best to use a will and a trust in your estate plan. Wilson Brown, PLLC has been helping residents with their San Antonio estate planning needs for over 30 years.
Costs: Initially, a living trust is more costly than a will because there is more work required at the beginning to get it set up. However, given the likelihood of probate and the potential for a guardianship, both of which are avoided with a living trust, a will can become more costly eventually.
Maintenance: Both a will and a living trust require maintaining to keep them current and achieve the outcome you desire. With each of those, you will need to make changes at some point or at least review them and consider changes whenever anything significant happens in your life such as a birth or death of a family member. Costs to maintain either a will or a living trust are comparable.
KEY TAKEAWAYS: Differences between a living trust and a will
- A living trust is valid while you are alive and after death. A will distributes your assets when you have passed away
- No probate needed with living trusts
- Although livings trusts have more upfront costs, they can be more affordable than wills and probate in the long run
- Whether you choose a will or a trust, you should seek the advice of your trusted professional advisors (tax, investment, and legal)
- By not putting off your estate planning and prioritizing it now, you can protect and provide for your loved ones both during your life and after death
Local and trusted estate planning attorneys in San Antonio, Wilson Brown, PLLC PLLC can help you decide how to best protect your property – through a will or a trust. We provide individualized options to clients, addressing their unique needs and goals. Our San Antonio estate planning attorneys take the time to explain how a will, living will, trust or other option can provide the best protection for you and your family. Call us today for a FREE case evaluation 210-591-2398 or complete a consultation request and we’ll be in touch shortly∎.