9737 Wadsworth Parkway | Westminster, Colorado, 80021

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Wills vs. Trusts: In Plain English

Most everyone has heard of wills and trusts and many know the basics of these important documents but they are rooted in centuries-old law and can be more complex than they seem.  While there are many similarities between them, there are also key differences.  The better choice depends upon your unique circumstances.

Wills vs. Trusts: Defined
A will is a legal document that outlines your final wishes regarding how your assets are to be distributed upon death.

A will:
● allows you to direct the division and gifting of accounts and property you own upon your death.
● lets you name an executor or personal representative to wind up your affairs
● typically requires your estate to go through the probate process
● does not govern accounts or property with beneficiary designations (e.g. life insurance)
● allows you to appoint a guardian for your minor children
● does not address incapacity
● can be changed or revoked during your lifetime
● can include protective trusts for your beneficiaries
● costs less than a trust to create but may cost more in time and money to go through the probate process after death

A trust is a legal arrangement that allows you (the trustmaker) to appoint a trusted individual (trustee) to manage accounts and property for your benefit and the benefit of others (beneficiaries) during your lifetime, during any period of incapacity and after death.

A trust may be
● revocable (which can be changed) or irrevocable (which cannot be changed)
● living (effective during your lifetime) or testamentary (created after death).

A trust:
● allows you to direct the division and gifting of your accounts and property
● lets you to manage your affairs while you’re able and name a successor trustee to take over when you are unable to do so
● can avoid probate if properly funded
● does not govern accounts and property with beneficiary designations (e.g. life insurance)
● allows you to name someone to manage assets for minor beneficiaries
● allows you to name someone to manage your affairs during incapacity, if needed
● can be changed during your lifetime, if irrevocable
● can include protective trusts for beneficiaries
● costs more to set up than a will but avoids the time and expense of probate

The Probate Process: A Key Consideration
One major factor when choosing between a will and a trust is the probate process.  ‘Probate,’ which literally means ‘to prove,’ is the process of determining the validity of a deceased person’s will, settling legitimate debts, and distributing assets to beneficiaries under court supervision.
Probate can be expensive, time consuming and requires detailed filings that become public record.  With a will requires probate.  A trust avoids probate.     

What’s right for you?  Every estate plan is unique.  For some, avoiding probate, planning for incapacity or protecting beneficiaries with a trust is critical.  For others, a simple will may suffice.  We can help you understand your options and tailor a plan that fits your needs.   Call (303) 861-2710 or contact us to schedule a consultation and take the next step in protecting your family and caring for your loved ones.