A will and a trust perform similar goals of distributing a person’s assets upon his or her death. However, a will must go through probate court, while a trust is able to skip going through probate.
By avoiding probate court, the distribution of your assets to your beneficiaries will remain private to you and your family, rather than becoming part of the public record in probate court.
As you are studying estate planning and trying to determine the best path forward for yourself, understanding what the difference is between a will and a trust is an important step you must take.
An estate planning attorney from our team can provide advice to help you determine which setup will work better for your needs.
Understanding the Benefits of a Living Trust Over a Will
A trust involves setting up your estate in a way that simplifies transferring your assets after your death to your beneficiaries. With the trust, you will appoint someone to manage your assets while you are still alive. (You can appoint yourself, as long as you are mentally able, or you can appoint a third party.)
The primary benefit of a living trust versus a will involves the speed with which the beneficiaries can receive the assets from the estate. Because the trust does not need to go through probate court, the distribution process can occur faster.
Reducing the Chance of a Legal Challenge
Additionally, because of the way Florida Statutes § 736 requires lawyers to set up the trust, the chances of having heirs file a legal challenge against the declarations of the trust are rare.
This also means that your estate will be less likely to incur legal costs after your death through legal challenges. You will be able to pass the full value of your estate to your beneficiaries.
Setting Up the Trust
When creating a living trust (also called a revocable living trust), you and your attorney will need to follow a few steps.
The grantor is the person who owns the assets or estate, and, by definition, the grantor becomes the person who creates the trust. Actually, an attorney will write up the trust document, but you, as the estate owner, become the grantor.
Rules for Trustees to Follow
Select a trustee to manage the assets while the owner of the trust is alive. The trustee will manage all of the assets that are part of the trust, along with paying any bills or choosing how the trust will invest the assets.
The trustee must follow a number of laws and rules when managing the trust. The Consumer Financial Protection Bureau (CFPB) spells out the rules for trusts in the state of Florida.
To consult with an experienced trusts and probate lawyer today, call 855-686-6752
Understanding the Benefits of a Will Over a Trust
A will is a legal document that provides directions for handling your affairs and your estate after you pass away.
Generally, a will is easier to create than a living trust, meaning it will cost less in legal fees upfront. Those who have non-complex estates may be able to use a will alone. Wills do not require you to assign a trustee.
With a will, you will be able to specify any wishes you have for your funeral or memorial service.
You may need both a Trust and a Will
Some people have an estate planning situation that causes them to set up both a will and a living trust. It may benefit you to have a will that sets up the legal distribution of your estate alongside the living trust.
For example, those who have minor children may need both a will and a trust to ensure the children’s legal guardian is clear, while also controlling how the children may receive the assets of the estate once they reach the legal age.
A Living Trust may Override a Will
As long as an attorney sets up your living trust and will properly, the two documents will complement each other, rather than having one of them override the other.
However, if a legal situation arises at the time of the planned distribution of the assets, the court will accept the wishes included in the trust over the will, because the court considers the trust as a separate entity.
We are Ready to Help with All of Your Estate Planning Requirements
If you are wondering what the difference between a will and a trust is, you can count on the team at Bogin, Munns & Munns to provide all of the advice and information you want.
We treat our clients like family. We will help you find the best path forward for setting up your estate and for distributing your assets to your heirs.
We will make sure you are legally covered, giving you peace of mind about the proper distribution of your estate following your death. To start the process, call us at (407) 578-1334 as soon as possible.