When planning your estate, one of the most common questions is whether you need a living trust or a will. Both documents allow you to specify how your assets should be distributed after your death, but they work differently and serve different purposes.
What Is a Will?
A will is a legal document that states your wishes for asset distribution and names guardians for minor children. It takes effect only after your death and must go through probate — a court-supervised process that can take months and cost 3–7% of your estate value.
What Is a Living Trust?
A living trust is a legal entity that holds your assets during your lifetime and specifies how they should be distributed after your death. Unlike a will, a living trust avoids probate entirely, saving time and money.
Key Differences
- Probate: Wills go through probate; trusts do not
- Privacy: Wills become public records; trusts remain private
- Cost to create: Wills cost less ($200–$1,000 vs $1,000–$3,000 for a trust)
- Disability protection: Trusts can manage your affairs if you become incapacitated; wills cannot
- Guardian nomination: Only wills can name guardians for minor children
- Complexity: Trusts require you to transfer assets into the trust; wills do not
Which Is Right for You?
Choose a will if you have a simple estate, young children (to name guardians), or limited assets. Consider a trust if you have significant assets, want to avoid probate, own real estate in multiple states, or value privacy.
Many people benefit from having both a living trust and a “pour-over will” that ensures any assets not transferred to the trust are still covered.
Consult an estate planning attorney to determine the best approach for your situation.