One of the first things that people have to decide when they start thinking about estate plans is whether they want to use a will or a trust. Both have their advantages.
If you start asking your friends and family or look on the Internet for estate planning advice, then you are likely to receive a lot of conflicting advice. Should you get a will or a trust? Nearly everyone seems to have an opinion one way or another.
Normally, the opinion of non-attorneys is rooted in which of the two options was best for the person giving the advice. It may or may not be the best advice for you.
To help decide the better option to use as the primary legal instrument in your estate plan it is helpful to know the basic differences between the two.
This was the subject of a Motley Fool article titled "Wills vs. Trusts: Which Are Better?"
A will determines who gets your possessions after you pass away. It has no legal effect until then. It is a roadmap for what you want to happen later. The rules for wills vary from state to state, but they need to go through probate court and the details are made public. For people with small estates they can be cost-effective.
Trusts, on the other hand, have legal effect as soon as they are executed. Property is placed in the trust while you are still alive. While trusts can be more costly to obtain and maintain, they do not ordinarily have to go through probate after you pass away and the details are not made available to the public. Trusts are normally preferred to wills for larger estates.
If you are uncertain whether a will or trust is a better option for you, that is okay. You probably should not decide between the two before talking to an estate planning attorney who can help you make the decision.
Reference: Motley Fool (Nov. 8, 2016) "Wills vs. Trusts: Which Are Better?"
