The primary difference between a will and a trust is that a will is a legal document that becomes effective upon your death, whereas a trust can be effective both during and after your lifetime. Additionally, a will only governs assets that are titled solely in your name and that pass through probate, whereas a trust can govern both probate assets and non-probate assets.
A will allows you to designate beneficiaries who will receive your assets upon your death, and it also allows you to appoint an executor who will manage your estate and distribute your assets according to your wishes. One limitation of a will is that it is subject to probate, which can be a time-consuming and expensive process.
A trust, on the other hand, allows you to transfer your assets into a trust during your lifetime, and to appoint a trustee who will manage the assets in the trust for the benefit of your designated beneficiaries. A trust can be revocable or irrevocable, and can be structured in various ways to meet your specific needs and goals. One benefit of a trust is that it allows you to avoid probate, which can save time and money and keep your affairs private.
Choosing whether to use a will or a trust depends on your individual circumstances and goals. If you have a relatively simple estate and only a few beneficiaries, a will might be sufficient for your needs. However, if you have a complex estate, multiple beneficiaries, or a desire for privacy, a trust might be a better option. It is best to consult with a licensed attorney to determine which option is best for you based on your specific situation.
In summary, the key differences between a will and a trust are that a will takes effect upon death and only governs probate assets, whereas a trust can take effect during and after your lifetime and can govern both probate and non-probate assets. Both options have their own advantages and limitations, and the choice between the two should be based on your individual circumstances and goals.
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