What is the difference between a living trust and a testamentary trust?

Living trusts and testamentary trusts are both types of estate planning tools used in California. These trusts are designed to transfer the ownership of property from one person to another. The main difference between them is when they are created and how they are administered. A living trust is a trust that is created while the person making the trust is still alive. It is funded with property that the grantor owns, such as real estate or investments. The trust can be used to manage the grantor’s assets and can also be used to provide for beneficiaries after the grantor’s death. The trust’s assets are administered by a trustee, who is appointed by the grantor and has the authority to manage the trust’s assets according to the grantor’s wishes. A testamentary trust is a trust that is created after the person who created the trust has passed away. It requires a valid will to be in place, and it is funded by assets that the deceased owned at the time of their death. Testamentary trusts are administered by a trustee based on the terms outlined in the will. The trust’s assets are used to provide for the beneficiaries of the trust, usually named in the will. Living trusts are created during the grantor’s lifetime and are commonly used to manage assets and provide for beneficiaries. Testamentary trusts are created after the grantor’s death and are used to fulfill the wishes outlined in the will. Both are important parts of estate planning in California.

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What is the difference between a living trust and a testamentary trust?

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