Trusts and wills are both estate planning tools used to manage and distribute assets upon an individual’s death, but they operate in different ways and serve distinct purposes. In this article, we will explore the key differences between trusts and wills, helping you make informed decisions about your estate planning needs.

Probate Avoidance:

One of the primary considerations in estate planning is probate. Probate is the court supervised administration of an estate. If you have a will, it is likely that your estate will go through probate. Assets held in a trust generally bypass probate entirely. This allows for quicker and more private distribution to beneficiaries.

Control and Flexibility:

Trusts provide greater control and flexibility over the distribution of assets. With a trust, you can specify detailed instructions, including conditions and timing of distributions. This level of customization allows you to address unique family dynamics, provide for minor children, protect assets from creditors, and ensure ongoing care for beneficiaries with special needs. By contrast, wills may not offer the same degree of flexibility and control over asset distribution.

Privacy:

Most things that happen in courts are open to the public. Wills and the administration of your estate become part of the public record during probate proceedings. This potentially exposes personal and financial information to public scrutiny. Trusts offer a higher level of confidentiality compared to wills. Since trusts are private documents that do not typically require court involvement. The terms of the trust and the identities of beneficiaries remain confidential.

Legal Authority:

A trust becomes effective immediately upon creation and can hold and manage assets during your lifetime and after your death. Wills, on the other hand, only become effective upon your death and require probate to validate their terms and distribute assets. While wills can address various matters, such as appointing guardians for minor children, they do not provide legal authority until admitted to probate.

Modification and Revocation:

Both trusts and wills allow you to adapt your estate plan to changing circumstances. Revocable trusts and wills can be modified or revoked during your lifetime.

Conclusion:

Depending on your goals, circumstances, and preferences, a combination of trusts and wills may be used to create a comprehensive estate plan that meets your needs. Trusts provide probate avoidance, enhanced control and flexibility, privacy, and comprehensive asset management. Wills offer simplicity and effectiveness but generally require probate after your death.

At Hale Skemp, we are dedicated to helping you navigate the complexities of estate planning and protect your assets for future generations. Contact us today to schedule a consultation and start building a personalized estate plan tailored to your unique needs and objectives. Let us help you achieve peace of mind knowing that your legacy is secure.