There are many different tools that allow people to create an estate plan that suits them. It is important to have a decent understanding of what these options are as well as their own benefits. When discussing a will and a living trust, many people are not aware of their differences. Continue reading below to learn more about these tools and contact an experienced New York estate planning attorney for guidance during this process.
What is a Will?
The following are the four main purposes of using a will in an estate plan:
- Provides instructions on how assets and property should be distributed upon a person’s death
- Names beneficiaries
- Allows a person to choose an executor to oversee the distribution of their assets
- Allows a person to choose a guardian to finish raising their minor children
A will only goes into effect after a person dies. This document does not cover any property that is held in a trust or joint tenancy, only property that is in their name. In order for the will to be carried out, it must first go through probate. This process consists of the court making sure the document is valid, outstanding debts are paid, and all assets have been appraised.
What is a Living Trust?
A trust establishes a legal relationship between a person (the trustee) and another individual who inherits the trust (the beneficiary). The trustee holds assets on behalf of the beneficiary through the trust. A living trust allows a trustee to manage these assets before and after death. This not only holds assets but defines how they are distributed upon death. The trustee is allowed complete control of these assets and can move them if they wish to do so.
What is the Difference Between a Will and Living Trust?
The differences between a will and a living trust are as follows:
- A will does not go into effect until you die while a living trust takes effect as soon as it is created
- A living trust allows you to bypass probate
- A living trust ensures privacy while a will is a public document
- Living trusts are generally more expensive to set up than a will
Contact our Firm
If you or a loved one needs assistance creating an estate plan and wish to speak with an experienced attorney, contact the Law Office of Andres D. Gil, PLLC today.