Wills and trusts serve the same core purpose, which is stating who receives your estate after you pass away. However, they operate in two entirely different ways that you should be aware of before deciding which is the best way to protect your family. There are a few key differences where a trust has an advantage over a will.
The first difference is that a trust allows for more control over the distribution of your estate to your heirs after you pass away. Under a will, if someone under the age of 18 is a beneficiary, the probate court must name someone to manage the money for the beneficiary until they reach age 18. Also, the probate court will supervise the use of the inheritance for the benefit of the minor beneficiary, including distributions for the beneficiary's health, education, maintenance, and support. A probate judge has the ability to prohibit distributions for certain purposes. With a trust, however, you may appoint a successor trustee to make all the decisions on how to spend and save the money in accordance with your wishes. You can also specify at what age (or ages) the beneficiary is able to control his or her inheritance. With a will, the probate court will release the money to the beneficiary as soon as they turn 18, even if they are not ready to manage wealth!
This leads us to another advantage of a trust over a will. A trust allows your estate to avoid the probate process. A will on the other hand, is required to be administered through probate. The probate process is where a court transfers ownership of assets from a deceased person to living beneficiaries. However, the probate court supervises everything your executor does as part of settling your estate. The process can be very time consuming and costly. A trust, on the other hand, can avoid the process all together. With a trust, your successor trustee can gather all of your assets and distribute them in accordance with the instructions of the trust that you have set up. There is no waiting period required in administering the trust, which means your beneficiaries can receives their assets faster and at less cost than if your estate were to go through the probate process.
Usually, when a trust is set up properly as part of a comprehensive estate plan, it can be a much faster, easier, and less expensive way to pass your assets to your heirs after you pass away. Call The Rosenbauer Law Office, LLC at 513-463-6789 to set up a consultation with an experienced estate planning attorney today to learn which option is best for you!