How do you compare a living trust vs. a will in California? Wills and trusts both allow you to dispose of your property to beneficiaries. Beyond that, there are few similarities. Show What Is a Will?A last will and testament is a legal document you create that specifies how your property will be distributed after you die, among other things. A will should normally contain the following:
You might add other items as well. You might, for example, use your will to create a testamentary trust, add a property to it, establish its terms and name a trustee to manage it. Child GuardianshipIf you have minor children living at home, it is critical that you name a guardian for them in your will. You might believe that you will easily live until your children grow up, and you might be right. Nevertheless, you wouldn’t want your untimely death to put the guardianship issue in the hands of a probate judge. After all, the probate judge likely has no idea who would be the best person to entrust with the care of your children. In California, you can completely disinherit your children if you wish, even if they are still minors when you die. Disinheriting a child does not eliminate child support obligations, however. What Is a Trust?A trust is a legal vehicle that allows you to appoint a trustee (including yourself) to manage assets on behalf of a beneficiary or beneficiaries. There are two main types of trusts: living trusts and testamentary trusts. One advantage of a trust is its flexibility. Instead of being forced to dispose of estate assets by the time probate closes, a trustee can continue managing trust assets for many years. Living TrustsWhat is the difference between a will and a living trust? To create a living trust, the settlor or trustor (the person who creates the trust) must put property into the trust (usually by changing the title), name a trustee to manage the assets, and name at least one beneficiary. You can serve as the trustee of your trust. A living trust is revocable unless you expressly declare it irrevocable. Your living trust will become effective as soon as you sign it, and it will normally become irrevocable as soon as you die. Your trust assets will not go through probate. Your successor trustee can continue managing the trust assets as usual, with no interruption caused by probate proceedings. Testamentary TrustsA last will and testament can include a testamentary trust. A testamentary trust is a trust that isn’t created until you die. The main advantage of a testamentary trust over a simple will is its flexibility. Ordinarily, probate assets must be distributed to estate beneficiaries by the time probate ends, typically about a year after the testator’s death. A testamentary trust, which sets out the terms of the trust, can distribute assets to beneficiaries for an indefinite period, just as a living trust can. Main Differences Between Wills and TrustsFollowing are some of the main differences between a living trust vs. a will:
The two main reasons people create trusts are to avoid probate and take advantage of their flexibility. Dying Without a WillIf you die without a will or with a will that the probate court declares invalid, you will die “intestate,” and California will distribute your property by state intestate succession law. The court will distribute your assets to your relatives based on the closeness of their kinship with you. It will also appoint guardians for your minor children without your input. Please consider that if you are wealthy, an estate plan might protect your beneficiaries from estate tax liability. Do I Need a Will or Living Trust?The California probate lawyers at Barr & Young have drafted hundreds of wills and trusts. We know how to prepare an estate plan that is tailor-made to suit your needs and preferences. Contact us online, or by telephone at (925) 660-7544. We represent clients from all over the Bay Area, including Berkeley, Danville, Livermore, Oakland, Pleasant Hill, Pleasanton, Richmond, San Francisco, or Walnut Creek. |