The differences between a will and living trust in California

California residents have the option to set up a will, create a living trust, or both as part of their estate plan.  

A will and a living trust are both valuable estate planning options, the purpose being to provide protections for your assets and to distribute them according to your wishes after your death. The main differences between a will and a living trust are what is included in each option, how it’s managed, and when it comes into effect.

A simple will is a legal document that directs the distribution of your assets after your death to your heirs and beneficiaries. It can also include instructions for appointing an executor, guardians for minor children or special needs individuals, and even directions for your funeral and burial.

A will must be signed and witnessed per state law, filed with the probate court in your jurisdiction, and carried out by the executor designated in the will. Because a will must go through probate court, it is made available to the public in the court’s records.

A living trust, on the other hand, is a legal document that provides for the direct transfer of assets from the owner or “grantor” to a trustee after the owner’s death or should the owner become incapacitated and can no longer manage their financial affairs. A trust is also established during the grantor’s lifetime, and they can serve as the trustee. 

The grantor sets the terms for asset management, the distribution of those assets, and for the disposition of those assets after death by the successor trustee. Trusts don’t have to go through the costly and lengthy probate process and aren’t a matter of public record.

Establishing your goals

Before deciding which estate planning tool is best for you, consider your estate planning goals; in other words, what is most important for you, your loved ones, and your personal situation. Common estate planning goals to be considered are:

  • Providing for your loved ones – your spouse, partner, children, or grandchildren
  • Mitigating or avoiding probate
  • Minimizing taxes
  • Protecting your assets
  • Providing for incapacity

The right estate plan can protect and preserve your legacy for future generations. It’s the gift that keeps on giving.

Which option is right for you

Both wills and living trusts serve the important job of passing your assets on to your loved ones. However, there are important differences between the two in terms of how they satisfy your estate planning objectives which is why consulting with an estate planning attorney is a great option to create a plan that fits your best interests.

Creating a living trust may involve more costs vs. a will, but the benefits of a trust outweigh the costs. At the Law Offices of David, W, Foley, a family-owned law firm, we have developed our living trust services to be affordable.

Take a few minutes to review some of the reasons you don’t need a living trust vs. why you do?