What is the Difference Between a Will and a Living Trust?
Scott Schomer of the Schomer Law Group explains the difference between a Will and a Trust. For more information, please call (310) 337-7696 or visit www.schomerlawgroup.com.
One of the questions I’m asked most frequently is, “what is the difference between a will and a trust?” There are very significant differences, starting with a will; a will is a document that only has an effect at your demise or your passing. It is a set of instructions to the probate court, but sometimes it does not absolutely control. At the end of the day, the probate court decides how and when your assets will be distributed if you use your will as a testamentary planning device. Most importantly, if you use a will, you’re forced to go through the probate administration process. The two big disadvantages of the probate administration process are the cost and the time delay. In California, a probate typically costs between four to eight percent of the gross value of your estate, quite a significant sum. In addition, it generally takes between nine to ten months minimum to process your assets through a probate estate process. In contrast, a living trust document is a contract that can take effect at your incapacity and prior to your passing. It is a set of specific instructions as to how your assets should be used, and most importantly, it completely avoids the probate administration process. It is not public, and it allows the private, simple administration of your estate after your demise with as few interruptions or problems as possible. It is what I like to refer to as, the greatest contract you will ever sign.
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