The following shows the defining differences between a Living Trust, A Will and not having any protection at all!
With No Will |
With A Will |
With A Living Trust |
At Incapacity (unable to handle your financial affairs)
| Court Control: Court appointee oversees your care, must keep detailed records, reports to court and usually must post bond (even if appointee is your spouse). Court approves all expenses, oversees financial affairs. | Court Control: Same as No Will |
No Court Control: Your Successor Trustee manages your financial affairs according to instructions in your Trust for as long as necessary. (In some states court intervention may be required for health care decisions). |
At Death
| Probate: Court orders debts paid and assets distributed according to state law. |
Probate: Same as no will, but assets distributed per your will (if valid and no contests are successful). | No Probate: Debts paid and assets distributed by Successor Trustee according to instructions in your Trust. |
Court Costs and Legal Fees
| At Death: Often estimated at 3% - 8% of estate´s value. At Incapacity: impossible to estimate. | At Death: Same as No Will. Costs can increase if will is contested. |
At Death: Usually none if no estate taxes. At Incapacity: None. (Attorney can be helpful for larger estates). |
Time
| At Death: Usually 9 months to 2 years before heirs can inherit. At Incapacity: Court involved until recovery or death. | At Death: Same as No Will. |
At Death: Usually just weeks (larger estates may take longer for estate tax filing). At Incapacity: No delays. |
Flexibility and Control
| None: Court processes, not your family, have control at incapacity and death. When you die, assets are distributed according to state laws. |
Limited: Same as No Will except, when you die, assets are distributed according to your will (if valid and no contest are successful). You can change your will at any time. |
Maximum: You can change/discontinue your Trust at any time. Assets stay under control of your Trust, even at incapacity, AND after your death. More difficult than a Will to contest. |
Privacy
| None: Court proceedings are public record. Family can be exposed to disgruntled heirs, unscrupulous solicitors. | None: Same as No Will. |
Maximum: Living Trusts are not public record. Your family can take care of your financial affairs, privately. |
