When it comes to estate planning, there are two main documents that people often consider: a will and a revocable trust. Both documents can be used to distribute assets after death, but they have different advantages and disadvantages.
What is a will?
A will is a legal document that outlines your wishes for the distribution of your assets after death. It also names an executor, who is responsible for carrying out your wishes. Wills are relatively simple to create and update, and they are relatively inexpensive.
What is a revocable trust?
A revocable trust is a legal entity that allows you to manage and distribute your assets during your lifetime and after death. It is also known as a living trust. Revocable trusts are more complex than wills, but they can offer some advantages, such as avoiding probate court and providing for your loved ones if you become incapacitated.
So, which is better: a will or a revocable trust?
The best way to decide which document is right for you is to speak with an estate planning attorney. They can help you understand your options and choose the document that is best for your individual needs.
Here is a more detailed comparison of wills and revocable trusts:
Will
- Pros:
- Simple to create and update
- Inexpensive
- Can be used to name guardians for minor children
- Can be used to leave specific gifts to specific people
- Cons:
- Assets must go through probate court
- May not be as flexible as a revocable trust
- May not provide as much privacy as a revocable trust
Revocable Trust
- Pros:
- Assets do not go through probate court
- More flexible than a will
- Provides more privacy than a will
- Can be used to manage assets if you become incapacitated
- Cons:
- More complex than a will
- More expensive than a will
- May not be suitable for everyone
Ultimately, the decision of whether to use a will or a revocable trust is a personal one. There is no right or wrong answer, and the best choice for you will depend on your individual circumstances.