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Last Updated on March 15, 2025 by Alaina
It’s never easy thinking about what will happen to your assets after you’ve gone, but for the sake of your family and your own sense of satisfaction, it really is best to start planning sooner rather than later. Especially when it comes to deciding between wills and trusts.
The issue is that it’s not quite as straightforward as simply writing down how you want things to be slipping among your inheritors because there are numerous different vehicles you can use depending on your situation and how you want to go about things.
Let’s take a look at the difference between trusts and wills, including their various up and downsides, to give you an idea of what might be the right choice for you.
What Are The Differences?
Generally speaking, a will dictates asset distribution after death and typically goes through probate, while a trust is a legal arrangement that can manage assets during one’s lifetime and after, often bypassing probate and offering greater control and privacy. Moreover, the way they’re handled can vary across state lines.
For example, the key differences between trust vs will in Washington State are that a will directs asset distribution through probate upon death, while a trust can manage assets during life and after, often avoiding probate and providing greater control and privacy, subject to Washington’s specific trust and estate laws. This can differ in different regions, so make sure you look into the laws of whatever state your estate is in so that you are able to make the correct choice
If you’re really unsure, you can always hire an estate attorney who will walk you through the main differences and give you legal advice based on how you want things to play out.
What Is A Trust?
Now that you have an overview of trusts and wills, let’s dig a little deeper into what each of these similar but drastically different processes entails. When it comes to trusts, most people associate them with people who have a more significant estate (and often with varying degrees of negative connotation).
To put it in its most fundamental form, a trust is a legal arrangement where you transfer your assets to a trustee (often a law firm) whose job is to manage them on your behalf. Unlike a will, they can be used throughout your life as well as after it, making them a unique option for those who want their beneficiaries to benefit somehow while you’re still alive.
Avoiding Probate And Ensuring Privacy
Assets held in a trust typically bypass probate, affording a far greater degree of privacy than a basic will. Some people don’t want a court rifling through their lives, nor do they want a nameless court appointee disbursing their lifetime work to the people they’ve designated. Moreover, because records are public, anyone can access information about the deceased’s estate, which isn’t something that most people desire.
Control Over Asset Management During Life
Because you are giving a trustee whom you have selected the right to manage your assets based on your wishes, you can tune things up over your lifetime. It’s not a one-time thing that you set up and leave until your death, and you are able to make adjustments and changes as you please.
Flexibility For Changing Circumstances
A trust offers much more flexibility than a will, as it allows you to set specific conditions for when and how beneficiaries receive assets. For instance, you could designate that your children can only gain access to funds after a certain age or other stipulation in order to avoid wasting it when they’re too young to know how to deal with a large amount of money.
Potential Tax Benefits For Beneficiaries
Now, we just need to say that you aren’t immune from paying tax simply by opting for trust over a will, but it does offer a few advantages. For one, trusts can be used to minimize or avoid the Generation-Skipping Transfer Tax (GSTT), which applies when assets are transferred to grandchildren or more distant descendants.
What Is A Will?
At its core, a will is basically a set of instructions regarding how you wish your estate to be split up among those you include in it. It’s more straightforward than a trust and offers some advantages that might be more beneficial to your circumstances.
Simple Distribution Of Assets Upon Death
Whatever you stipulate in your will is usually going to be honored to the word. This means that unless you have made it deliberately ambiguous, there is no chance that members of your family can argue about what they receive (nobody wants their death to be the cause of a family breaking apart). In essence, you will state that you wish to so and so to receive a certain amount, and that will be carried out by the law firm representing your estate.
Designating Guardians For Minor Children
This is perhaps the most critical difference between these two options for those with young children. A will enables you to designate a legal guardian who shall look after your child up to adulthood in your stead. While this is obviously only advantageous if you happen to be the parent of small children, if so, you may need to create a will purely for this purpose.
Clear Instructions For Funeral Arrangements
Within your will, it’s also possible to state any arrangements you wish to be made regarding your funeral. Again, this might not be something that you particularly care about, but for those who want or need to be bored in a specific manner, you are able to note down how it will be carried out and the amount of money to be put towards it. This avoids the risk of any beneficiaries choosing to ignore your wishes and pocketing the money you’ve designated for the task.
What’s right for you really depends on your current situation. If you value privacy and want to have greater control over your estate while living, then a trust might be best. Conversely, a will could be your best option if you need to designate legal guardians for children or a small estate.