Wills and living trusts (also known as a Revocable Trust) are both estate planning tools that help you distribute your assets after death as you see fit, but there are distinct differences between the two. As an experienced Maryland estate planning attorney, I would like to share the differences between wills and living trusts so that you can make informed decisions.
When Do They Take Effect?
One major difference between a will and a living trust is that wills only take effect after you have passed away, but living trusts take effect once they’ve been signed and funded. Since living trusts take immediate effect, they provide you with a little more flexibility with how you handle and distribute your assets.
Will You Have to Go to Probate Court?
One of the biggest advantages of choosing a living trust is you can avoid probate court. Probate is the process of administering an estate’s assets once the will’s signer has died. Assets that pass through wills must go through probate; living trusts can avoid this process.
What Kind of Assets Do You Have?
Wills are typically easier and less expensive to establish and are used for those who don’t own too many assets. If you have significant assets, or high value assets, the cost savings with a living trust can more than offset the cost of the Trust. A trust also allows you the flexibility to hold those assets in further trust for people after you die, and allows someone you name (a successor Trustee) to handle those assets if you become unable.
Guardianship of Minors
If you are the parent or guardian of a minor child, you must nominate someone to be guardian of your child after your death. Failure to do so could result in the children going to either your immediate next of kin or into state custody. Only a will allows you to provide for guardianship. However, a proper living trust is also written with a simple will (a so-called Pourover Will) that names your children’s guardians, and provides for assets that are not in your trust (such as money that comes after you are deceased).
Work with an Experienced Maryland Estate Planning Attorney
Here at DK Rus Law, we have the expertise and knowledge of Maryland law needed to advise you as to whether a living trust or will is better for you. If you have any questions about whether you should establish a will or a living trust, or general estate planning concerns, contact us today and we would be happy to assist you or schedule a consultation.