What is the difference between a will and a trust?

A will is a legal document that serves to transfer a person’s assets such as property, investments, and money, upon their death. A trust, on the other hand, is an arrangement in which a trustor gives a trustee the legal authority to manage the trustor’s assets for the benefit of the trustor’s beneficiaries. The main difference between a will and a trust is when the assets are transferred. A will generally only takes effect after a person’s death, as it is not implemented until it is proven valid in probate court. A trust, however, can become active during a person’s lifetime, depending on the terms and conditions of the trust. A trust can also help to avoid probate court, which can be a lengthy and expensive process. Additionally, a will is public knowledge and anyone can read the instructions it contains; whereas, the terms of a trust are typically kept private. A will generally only deals with distribution of property after death, while a trust can also provide instructions on how the assets are to be managed during life. For example, a trust can be set up to provide for a minor child’s needs until they reach adulthood. Finally, a will is mostly used to transfer assets while a trust can also be used to manage assets. Trusts are commonly used to reduce estate taxes and provide asset protection. This means that the trustor can ensure that their assets are passed on in a controlled and protected manner.

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