Although both wills and trusts are legal documents for managing your estate, they are created under different laws. Trusts are subject to contract law and wills to probate law. Contract law is governed by a stricter standard than testamentary law, meaning that a living trust generally replaces a will. A living trust is more expensive to establish than a typical will because it must be actively managed after its creation.
However, the most important thing is that a living trust is useless unless it is financed. A will is more likely to be contested than a trust. Trusts are rarely questioned, partly because their details are not public. In addition, the rules for contesting wills are well established, while there are fewer laws relating to challenges to trusts.
When it comes to protecting your loved ones, it's essential to have both a will and a trust. The main function of wills and trusts is to name the beneficiaries of your property. In a will, you simply describe the property and list who should get it. When using a trust, you must do so and also transfer ownership to the trust.
See Transfer of Ownership to Trust, below.
Leave a Comment