Graphic Do you need a will, a trust or both?

Learn about the main differences between these two estate planning vehicles

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Long description

Wills and trusts are two important estate planning tools. While everyone may consider establishing a will, many families can additionally benefit from establishing a trust.

Key Takeaways:

  • A will is a legal document that sets out your intentions as to how your assets should be distributed after you pass away.
  • A trust is an arrangement that can allow you to set aside assets on behalf of a beneficiary.
  • Unlike wills, trusts generally avoid passing through probate—the court-supervised process of proving the legal validity of a will and distributing assets. Skipping this step may help assets reach heirs faster.
  • Some assets may bypass probate even if they are not included in trust, including retirement accounts with named beneficiaries, proceeds from insurance policies with named beneficiaries and financial accounts with “transfer on death” instructions.
  • Trusts can provide additional benefits, such as protecting privacy and potentially helping to shield assets from the estate tax. However, a trust can be more expensive than a will to establish and maintain.

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