What is the difference between a will and a trust?

The difference between a will and a trust is an important concept to understand when considering elder law in California. A will, also known as a last will and testament, is a document that is written and legally witnessed by another adult. It states the wishes of a person regarding the disposition of their assets and property, who will receive those assets, and who will be in charge of administering their estate after they die. A trust is a legal contract between the person creating the trust (the settlor) and the trustee, which dictates how the trust assets are to be managed and distributed. The trust can be revocable or irrevocable, depending on the terms of the trust. A will directs the transfer of assets to beneficiaries when the person who left the will dies, whereas a trust can be used to transfer assets while a person is still alive and can be used to manage assets into the future. A trust can also be used to instruct the trustee to pay out a certain amount of money to the settlor’s beneficiaries, such as a spouse, children, or other designated parties, in a specified order, such as monthly or yearly payments. A will is easier to create, while a trust may be more complicated and require the assistance of an attorney. In California, wills and trusts can both be used to manage and transfer assets and property, however, each has distinct advantages and drawbacks depending on the particular situation. For example, a trust may be a better option for individuals that have complicated business interests, or for those wanting to avoid the probate process. Wills, however, are simpler to establish, so may be more appropriate for those who have a simpler situation. Ultimately, understanding the difference between a will and a trust is an essential part of estate planning.

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