A Trust and a Will are both estate planning devices. However, each serves a different purpose, and both can work together to form a complete estate plan. This blog will provide a short explanation of the function of each and how they differ from one another.
What is a Will?
A Will is a legal document which sets out how you want your assets to be distributed following your death. It is important that your Will is clear, legally valid and up-to-date. For these reasons, many people seek the help of legal professionals who specialise in probate.
A Will passes through probate, i.e. a court oversees its administration, ensuring that it is valid and that the property is distributed according to the wishes of the deceased.
What is a Trust?
While a Will only comes into effect after your death, a Trust can be used to distribute property before or after death.
A Trust is a more difficult concept to define. Put simply, a Trust is a legal arrangement in which a person or institution, known as a “trustee”, holds property for another person (a “beneficiary”). Trustees are granted with a number of responsibilities in relation to your assets, so it is crucial that you give serious thought and consideration to who you choose.
A Trust can be revocable, i.e. the person who set up the Trust can alter or revoke it at any time. Often a Trust is revocable until the settlor dies, at which point it becomes irrevocable.
As a Trust passes outside of probate, some people create Trusts in order to avoid it. Without the need for court proceedings, a Trust can save both time and money. Unlike a Will, however, a Trust does not enable you to specify court arrangements or name a guardian for your children.
Both Wills and Trusts have their own benefits and limitations, so it is important to consider both when planning your estate.
Contact Us
Szabo & Associates, Solicitors can offer expert advice on a wide range of legal matters, including contesting, making or updating a Will and preparing a Power of Attorney. Please call George Szabo on 01292815088 or fill in our online contact form.
