The main difference between a will and a living trust is when these declarations come into effect. A will is executed after the author dies. A living trust comes into effect when it’s written, and the author can be in full charge of their trust while they’re alive. Many people opt to have both a will and a living trust because using a trust helps avoid the long and complex process of probate, meaning it’s easier and more private for handling assets after your death.
Living trusts can be used to manage larger assets, including money or property. For example, a grandparent may allocate some funds in a living trust to be given to a grandchild when they go to university. The living trust is revocable, so as long as the holder of the trust is alive, they can change the allocations in the trust at will.
Upon their death, the ability to manage the trust goes to a nominated trustee. Trusts don’t go through the probate process, so this keeps the assets private and means they can be distributed more quickly and efficiently than assets in a will.
Some issues should be handled via a will. For example, the will is used to lay out:
In some states, small estates can be handled without going through probate, but the limits on what is classed as a small estate can vary significantly. Fewer than half of all Americans have a will. If a person dies without a will, the courts can make decisions about issues such as the guardianship of the deceased’s children. This can be a long and difficult process. Writing a will helps make it less stressful.