Whats the Difference Between a Will and a Living Trust?


A will instructs the courts on how to distribute assets of the deceased. Otherwise, a judge determines heirs and distribution. However, creating a will does not avoid probate court, which may be required to satisfy debts. Probate averages 18 months and may take longer with extenuating circumstances, such as selling a home or owning property in multiple states.

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During this time, heirs are responsible for attorney and court fees because they do not yet have access to any assets. Finally, information filed in probate court becomes public.

A living trust names beneficiaries and allows them to receive assets even while the trustee (owner) lives. Assets belong to the trust, avoiding probate. A specified successor trustee becomes responsible for distributing assets after the trustee’s death. Methods of distribution, including outright lump-sum payments, parcels distributed at different ages, or parcels distributed by time interval, can be specified in the trust. A legacy trust distributes income generated from assets, potentially benefiting a family for generations as long as assets are viable. Finally, a trust can include provisions to protect assets against creditors or spouses, allow distributions to avoid disqualifying beneficiaries from aid, or require financial education or drug testing before receiving assets.

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