Will or trust: which one?

Most people need a will, and some also need a trust.

What a will does.

A will says who gets your things after you are gone, and who is in charge. It names a guardian for young children.

A will goes through probate. Probate is the court process that confirms the will. It gives your chosen person the power to act.

What a living trust does.

A revocable living trust is like a box you set up while you are alive. You move things into it, like your home or an investment account.

You stay in charge as the trustee. When you die, the person you named takes over and passes things on. Things in the trust usually skip probate.

Why people choose a trust.

1. To skip some court steps. In some places, probate is slow or costly. A trust can make things faster for your family.
2. Privacy. A will can become public in probate. A trust usually stays private.
3. Property in more than one place. A cabin in another state can mean a second probate. A trust can avoid that.
4. A plan if you can't manage things. Your backup trustee steps in.
5. Control over timing. A trust can hand out money over time, not all at once.

Why a will may be enough.

If your things are simple, a will often does the job. Many accounts can already pass outside probate.

Retirement accounts and life insurance go to the people named on them. Some bank accounts let you name a payable-on-death person.

You still need a will with a trust.

Even with a trust, you need a short will called a pour-over will. It catches anything you forgot to move into the trust. It also names a guardian for young children.

The step people miss.

A trust only controls what you put in it. If you sign a trust but never move your home into it, the home still goes through probate.

Moving things in is called funding the trust. It means changing the owner on deeds and accounts to the trust. This is the step most often left undone.

Canada is a bit different.

Living trusts are less common in Canada. Probate fees vary a lot by province.

In Ontario, the Estate Administration Tax is about $15 per $1,000 above the first $50,000.[15] In Alberta, the fee is capped at $525.[15] Ask a lawyer where you live.

A simple way to decide.

1. Do you own a home or land in more than one state or province? A trust may help.
2. Do you want privacy, or a plan for handing out money over time? A trust may help.
3. Are your things simple, with named people on your accounts? A will may be enough.
4. Not sure? Start with a will, a power of attorney, and a health directive. You can add a trust later.

How we help.

Our Essential plan gives you three papers. You get a will, a financial power of attorney, and a health directive.

Our Complete plan adds a revocable living trust, a pour-over will, and trackers that show what is in your trust. A lawyer review is available for a flat fee.