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Wills vs. Trusts – What’s the Difference?


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Dying intestate — without an estate plan — leaves behind a nightmare for your loved ones. It ties them up in probate court trying to sort out your estate, often for years. That legacy of chaos and contention is the last thing most of us want to leave behind.

That means you need to create detailed legally binding instructions for your estate in the form of a will or living trust. But which do you need? Or should you have both?

For layfolk, the differences quickly start feeling esoteric and unnecessarily complicated. But fortunately, you can start simple through a company like Trust & Will, and gradually add layers of complexity as you need them and as your wealth and estate grow.

Introduction to Last Wills

Last Will And Testament House Fountain Pen Gravel

Conventional wisdom suggests everyone needs a last will and testament document, even if they also create a living trust.

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In their simplest form, wills serve several vital purposes. First, they assign an executor: a person to oversee and distribute your estate after you die.

Second, they detail your wishes for that distribution. We all have a different vision for who should receive which of our assets, and your will is the place to spell out that vision.

Finally, if you have minor children, your will assigns guardianship for them.

Wills can serve other purposes as well. Beyond the basics, your will can also include instructions for pets, specific people you wish to disinherit, organ donor preferences, funeral wishes, or any other final instructions you want to leave. While all may not apply to you, make sure you understand each of them before finalizing your last will.

Care of Minor Children

Only a last will can assign guardianship of minor children. Your living trust cannot do so in a legally binding way.

If you have a child under the age of 18 or are trying to conceive, include a provision in your will about who should assume care of them until they reach the age of majority. Otherwise, your executor (or worse, a probate judge) must assign guardianship for you.

Also, carefully consider any financial provisions needed to help this guardian raise your child or children. According to an analysis by the USDA, it costs an average of $233,610 to raise a child to adulthood. And no, that doesn’t include the cost of college, which could add another $200,000 or more.

Even if you ultimately want much of your estate to go to your children once they reach adulthood, make sure you provide money to their legal guardian to help them cover costs like housing, feeding, and clothing your children.

Remember, you can assign someone the rights and responsibilities to manage your minor children’s inheritance until they turn 18. That person does not have to be their legal guardian, although it can be.

This property manager can oversee the details of your children’s inheritance, such as investments and asset allocation, on your children’s behalf until they come of age.


Only a will can disinherit a current spouse or an adult child. A living trust cannot.

That said, family members can still challenge a will that explicitly disinherits them in probate court. Disinherited and disgruntled spouses and adult children often hire an attorney to fight for what they perceive as unfair disinheritance.

For example, a disinherited child could argue you weren’t in a fit mental state when you wrote your will. They could also present evidence to discredit your reasons for disinheriting them.

Despite the risk of challenge, if you want to exclude an immediate family member from your inheritance, make sure you explicitly disinherit them in your will. Ask an estate planning attorney for advice on how to do so with the best odds of success, which includes explaining your reasons.

Different states impose different laws regarding disinheritance, so make sure you understand the requirements in your state.


Your pets may feel like your children, but they’re not. Unlike humans, animals cannot legally own any assets whatsoever.

So you can’t leave money directly to your pets. But that doesn’t mean your will should ignore them entirely.

Approach estate planning for your pets with two focuses: guardianship and care costs.

As with minor children, you should declare your wishes for who should take custodianship of all pets. You can write out different provisions for different pets, but also add a blanket clause for unspecified pets, in case you acquire new ones not listed in your will by the time you pass.

You can leave some money to these custodians to help cover the costs of caring for them. As all pet owners know, it costs money to care for an animal.

Final Wishes & Funeral Instructions

Your last will is also an appropriate legal document to detail your wishes for your remains and your funeral or other final rites.

It goes for elaborate wishes, but it also goes for simple ones. Facing the death of a family member, many loved ones succumb to upselling by funeral services.

At the risk of sounding cynical, the industry surrounding death uses sales tactics just like any other industry, and they know how to frame their questions in a way that pushes customers to spend more.

But many people don’t want their heirs blowing half their inheritance on a fancier casket or more flowers. They want them to use it to improve their lives.

If you fall into that category, write out detailed instructions for the kind of ceremony you want, the kind of casket or urn you want, and burial or cremation instructions. Set aside a specific budget for it in your will, and instruct your loved ones not to spend any more than that.

You can also use a letter of instruction for this purpose, although a last will proves far more effective and binding.

Organ Donor Wishes

While not necessary to include in a will, you can leave instructions about your wishes for organ donation here.

You can also include these wishes in your medical planning documents, such as your living will or do-not-resuscitate order. These documents explicitly spell out your instructions if you become incapacitated and can no longer make medical decisions.

Not everyone has strong feelings on organ donation, but if you do, it doesn’t hurt to include them in your will.


The problem with last wills lies in the probate process. It’s expensive, it’s public, it’s time-consuming, and it can get contentious.

When you die, legal ownership of your property passes to your estate to be distributed by your executor. Your last will becomes public record, and a judge in probate court oversees the distribution of your assets and rules on any disagreements between heirs. They also rule on challenges from those not named as heirs who feel they’re entitled to a piece of your pie.

Most states require the executor to hire a probate attorney (exceptions include California and Wisconsin). With probate lasting as long as 18 months in some cases, the attorney fees can quickly add up, often eating away a large percentage of the estate.

Don’t want to subject your heirs and estate to such an expensive, time-consuming, and public process? That’s where a living trust comes into play.

Introduction to Living Trusts

Living Trust Estate Planning Leather Briefcase Documents Envelope

First, keep in mind that there are many different types of trusts, and you may want or need several. Plan for ongoing conversations about your needs for different trusts with an estate planning attorney, but start the conversation by asking about a revocable living trust.

As the name suggests, you can change, update, or even entirely revoke a revocable living trust at any time. You typically name yourself the trustee while you’re alive, and the successor trustee only steps in if you become disabled or die.

By far the most significant advantage of a living trust lies in its ability to streamline your estate and help your family avoid the hassles and expense of probate. But that’s not the only reason to have one.

Avoid Probate for Faster, Cheaper Distribution

A revocable living trust moves your assets into a trust so they can go directly to your heirs upon your death. Your family doesn’t have to go through probate or the court system, and your estate doesn’t have to go on public record.

Instead, you simply name a successor trustee to distribute your assets directly to your heirs. This trustee serves a similar function as an estate’s executor.

Because your assets don’t have to transfer into your estate, and the process doesn’t need oversight from a judge, your trustee can simply transfer ownership directly from your trust to your heirs.

For example, they can simply move money from your brokerage account to your daughter’s account. They can deed a piece of real estate to your son’s name directly from the trust.

That makes the legal process move much faster. Instead of months or even years, the distribution of your estate can take place in just weeks.

Reduced Opportunity for Infighting or Challenges

Distributing assets through a living trust also happens privately. In addition to maintaining your and your family’s privacy, it reduces the odds of non-heirs coming forward to attempt to claim money or property. Your trustee can quietly approach each heir and deliver their inheritance with no fanfare or court appearances.

Beyond the veil of privacy, living trusts come with other inherent protections against court challenges. The laws governing them make them less open to challenge compared to wills.

The relative obscurity and complexity of trusts make them harder for disgruntled family members to contest, and less case law on the books makes trusts harder for attorneys to challenge as well.

Downsides of Living Trusts

To be most effective, you need to transfer legal ownership of your assets into the name of your living trust — while you’re still alive.

That means headaches and costs, such as deeding your real estate into the trust’s name instead of your personal name. Ideally, you change the name on all major financial accounts and assets.

It also typically costs more to create a living trust than a will. And remember you also need a will to lay out instructions such as guardianship of your minor children, which living trusts don’t cover.

Because living trusts are most effective when you title your assets under them, they require more work on an ongoing basis.

Trust Funds

Trusts work well to establish long-term financial management and distributions. If you want to create long-term financial instructions, talk to your estate planning attorney about creating a trust fund in addition to your living trust.

For example, imagine you want your child to benefit from and eventually inherit your money but not simply as a lump sum on their 18th birthday. To accomplish that, you create a trust that allows them access to money for their college education when they turn 18 but not the entire inheritance in cash.

You can also set up provisions for how the remaining estate eventually transfers to them. They could receive it all when they turn 30, or they could receive monthly dividend and interest payments for the rest of their life, or it could go into a retirement account to keep them comfortable in their older years.

You get to decide how and when your heirs get your money.

Do You Need a Living Trust or Just a Will?

Like most legal questions, the answer is: It depends.

The smaller your estate, the less value comes from a living trust. The average middle-class American likely doesn’t need a living trust because their family can get through the probate process quickly enough.

With more assets, probate becomes both more complex and more contentious. People tend to fight harder when the stakes are higher, after all. And with more wealth, you probably value privacy more than someone with few assets and possessions.

As you build wealth over time, start thinking more about a quick, private, less challengeable living trust rather than solely a will.

Age also matters. Beyond usually owning fewer assets, younger people typically have plenty of years — and changes required in their estate planning — ahead of them.

Wills can be simple, but living trusts require more complexity and generally require the trust itself to own the assets. That adds the hassle of actually transitioning legal ownership of all your assets into the trust’s name while you still live.

Anyone who expects to live for many years to come should start with a will and consider adding a living trust as they age.

Your marriage status impacts the decision as well. Most happily married couples want their spouse to simply take over most or all of their assets when they die. Your jointly owned assets, such as your house or bank accounts with both names, do that automatically. And most states offer an expedited probate process for surviving spouses.

Note that using a living trust in addition to a will does not let your heirs dodge estate taxes. Speak with a tax attorney for legal advice about your tax implications as a grantor and your heirs’ tax implications before you hire a law firm to have a trust drawn up.

Other Ways to Avoid Probate

In addition to trusts and a married couple’s jointly owned assets typically defaulting to the surviving spouse automatically, there are many other ways to avoid probate.

For real estate, many states have specific legal designations for married ownership, such as “tenants by the entirety,” wherein a deceased spouse’s ownership automatically transfers to the survivor.

When you buy life insurance, you name a beneficiary. When you die, they receive money outside of probate.

You can name a beneficiary for your retirement accounts as well. Just be wary of the SECURE Act’s restrictions on passing on retirement accounts.

Bank accounts also typically allow you to add a pay-on-death designation. Or you can open joint accounts with your heirs so they can access the funds with no restrictions after you die.

Finally, you can make tax-free gifts to heirs every year while you live. If you know you have enough money for retirement, you can let your loved ones start benefiting from your assets before you die.

Where to Find Estate Planning Documents

You can hire an estate planning attorney to draft your last will and possibly your living trust documents. And if you have a high net worth, you probably should.

But the average American doesn’t need to spend hundreds or thousands of dollars on estate planning documents. In today’s world, you have plenty of options for do-it-yourself legal services.

Start with Trust & Will as you explore estate planning services. Estate planning attorneys write all their documents, and their interface helps you customize those documents to fit your needs. See our full Trust & Will review for a complete breakdown of the pros and cons.

Other reputable options include LegalZoom, LawDepotNolo, and Rocket Lawyer. All offer wills and living trusts, and all do them well.

Just be careful to use a reputable DIY service if you do opt to build one online.

Final Word

It’s trite, but it’s true: You can’t take anything with you when you die.

Every adult should have a will, even if only a simple one outlining their executor and who should receive their assets in broad terms. It should also name a guardian for minor children — even if you don’t have any yet.

Make sure you speak with your parents about their estate plan as well. You don’t have to ask them nosey questions about who gets what. But you have a right to press them to create a will or living trust so you don’t get left cleaning up the mess in probate court if they die intestate.

The more prepared we all are for our inevitable demise, the less traumatic the legal side of our death will be on our loved ones.


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G. Brian Davis is a real estate investor, personal finance writer, and travel addict mildly obsessed with FIRE. He spends nine months of the year in Abu Dhabi, and splits the rest of the year between his hometown of Baltimore and traveling the world.