What Seniors Should Know About Trusts vs. Wills
The words estate planning may sound more complex than you want to tackle. But once you sort out the basics, it’s simply two different tools with specific jobs.
A will states who gets what after you’re gone. A trust can provide additional legal control over when and how your assets are distributed, during and after your lifetime.
The Basics of Each Document
Will:
A will is a legal declaration that:
Names beneficiaries
Appoints guardians for minor dependents
Designates an executor to manage your estate
It only takes effect after death and will likely be subject to probate.
Trust:
A trust is a legal entity that holds property on behalf of beneficiaries. A revocable living trust is one that you can modify at any time before your death and can avoid probate for assets titled in the trust’s name.
The Modern Estate Plan Usually Includes Both
You might wonder why you’d need a will if a trust can do so much in assisted living Lakewood. A will still perform several important functions that a trust cannot replace:
Names a personal representative to manage your estate, pay final bills and taxes, and oversee asset distribution
Provides guardianship for minor grandchildren if you have financial obligations to them
Ensures assets titled only in your individual name (“oops”) are added to the trust (“pour over”) after your death
States your intent for sentimental or personal property that may not have market value but holds family importance
Advantages of a Trust
A trust can offer specific advantages, which is why many people add one to their estate plan while in assisted living facilities:
May shorten the court process and keep family matters private
Helps avoid probate if you own real estate or property in more than one state
Allows staged distributions for young adults (for example, “tuition at 18, balance at 30”)
Protects you if you become ill and need help managing your finances
Key Documents That Work Together
Durable financial power of attorney: allows someone to act for you if you become incapacitated
Health care proxy and advance directive (living will): outline your wishes in a medical emergency
Beneficiary designations: for retirement accounts, life insurance policies, and other assets
Errors to Avoid
Setting up a trust but not retitling your assets into it
Failing to update beneficiaries after marriage, divorce, or death
Not leaving access information for digital accounts and passwords
Ignoring state laws that affect taxes, spousal rights, or notarization requirements
Actions to Take Now
Inventory all accounts, deeds, loans, and insurance policies and keep the list in one place
Evaluate who among your children or relatives has the organization and financial sense to serve as executor or trustee
Communicate with adult children about where documents are kept and what to expect
Review your plan every three to five years, or after major life events like divorce or buying a new home
Public libraries, senior centers, senior living Lakewood communities, and local bar associations often have free or low-cost workshops on estate planning. They can help you learn how to find an estate planning attorney in your area.
