What Is a Will?
A will is essentially a document in which you leave a series of directives for when you pass away. Through this document, you express that, at the time of your death, you would like a specific group of people—known as your beneficiaries—to receive your possessions or assets in a particular way, and you identify who the guardian of your young children should be.
A will goes into effect when you die. Until that time, it is merely a document stored in a file. You should consider updating your will every five years, or sooner if there have been significant life changes such as a divorce, marriage, purchasing a new home, or having a new child.
A will does not circumvent probate court, although a well‑crafted will can help make the process more straightforward. A will also does not include legal or medical powers of attorney, which grant an agent the authority to make decisions on your behalf if you are incapacitated.
Furthermore, a will is a public document. It does not keep your affairs private. For this reason, some people choose to establish a trust instead of a will.
What Is a Trust?
A living trust, more commonly referred to as a trust, is a legal entity created to control your assets. To create a trust, you must first establish it and then transfer the assets you want included—such as bank accounts, property, a house, or a car—into the trust by titling them in the name of the trust.
The key difference between a will and a trust is that a will only become effective upon your death, whereas a trust is created while you are still living. You retain control over the trust and all of its assets until you pass away.
Another distinction between a will and a trust involves cost and timing. In the short term, a trust is typically more expensive to establish than a will.
However, a significant advantage of a trust is that it can incorporate legal powers of attorney. Most trusts are structured so that control shifts upon death or incapacity, making a separate power of attorney unnecessary.
A trust can help you avoid the probate process. It allows expenses to be paid immediately, with no costs incurred later. A trust also keeps your affairs private, as it is not public record, and most importantly, it ensures that your assets are transferred exactly as you intend, with you deciding who has authority over them.
For individuals with young children, a trust can also be created within a will to designate an adult who will oversee the children’s inheritance until they are old enough and mature enough to manage it themselves.
