As a lawyer, I can clarify the differences between a Will and a Trust in estate planning.
A Will is a written document that outlines how a person's assets will be distributed after they pass away. It must go through a court proceeding called probate, which can be time-consuming and expensive. A Will allows the person creating it (the testator) to name an executor, who is responsible for managing the estate during probate and distributing assets according to the Will's instructions.
A Trust, on the other hand, is a legal entity created by the person transferring assets to it during their lifetime (the grantor). The person creating the trust can also act as the trustee, managing the assets held in the trust, and determining how they are used for themselves during their lifetime. The trust includes instructions for how the assets should be distributed after the grantor's death, and because the assets are held in a trust, they do not have to go through probate. Avoiding probate can make the distribution of assets faster and less expensive for the beneficiaries.
There are different types of Trusts, such as revocable and irrevocable trusts, charitable trusts, and special needs trusts. Each has unique requirements and limitations.
One potential limitation of a Will is that it only takes effect after the testator's death. A Trust can be set up to provide for the grantor and their loved ones during their lifetime and can continue to exist after the grantor's death, providing ongoing support or income for beneficiaries.
To summarize, a Will dictates how assets will be distributed after death and goes through probate, while a Trust can begin distributing assets during the grantor’s lifetime and does not go through probate, but involves a more complex setup process. It is best to consult with an attorney to determine which option is more appropriate for your specific needs and to ensure your estate plan is legally sound.
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