Benefits of a Trust over a Will

1. Summary of Advantages to Using a Will

2. Summary of Advantages to Using a Revocable Living Trust

3. Issues Having No Obvious Advantage between Using a Will vs. a Revocable Living Trust

4. Obtaining "The Best of Both Worlds"

5. What is Probate?

ESTATE PLANNING

Summary of Advantages to Using a Will:     

1. During Life:

   1. Easier and cheaper to prepare.

   2. Avoids the necessity of transferring all your existing and after-acquired property to a Trust.

   3. More convenient:

      • Has no effect until death;

      • Avoids Trust management problems; and

      • You can continue to hold and manage your property just like you always have.
         

2. At Death:

   1. A neutral, third-party (a Judge) is available who can supervise the process, ensure that it is proceeding according to law, and resolve any disputes (eg, among your Beneficiaries, between them and the Personal Representative, or regarding title to property or legitimacy of debt).

   2. An objective process is available that extinguishes claims against you and your estate that is quick and fair to debtors, creditors, and your Beneficiaries.

   3. Only a Personal Representative can bring or defend a lawsuit on your behalf.

   4. In Washington, because of its liberal, consumer-oriented probate laws, the probate process can be remarkably simple, quick, efficient, and inexpensive.

   5. Avoids Trust "Time Bomb" problem, the possibility that a probate will be needed despite having a Trust.

Summary of Advantages to Using a Revocable Living Trust:     

1. During Life:

   1. Can provide for asset management upon disability, possibly avoiding the appointment of a Guardian for your Estate (although with a Will, that appointment might not be needed through the use of a Durable Power of Attorney for Assets).

   2. Easier to keep spouses' property separate and to maintain its non-community character.
       

2. At Death:

   1. Avoids the necessity of a probate proceeding in your home state so long as none of your property remains titled in your name.

   2. Avoids the necessity of a probate proceeding in any other state in which you own real property so long as that property is titled in the name of your Trust.

   3. Quicker and less expensive, especially if you are a resident of a state (eg, California) that provides for:

      1. A more formal probate process,

      2. "Statutory" probate commissions and fees based on the value of the assets in your probate estate,

      3. A Court filing fee also based on the value of the assets in your probate estate.

   4. Your estate plan and the administration of your estate are not made public.

   5. Your Beneficiaries are not entitled to disclosure of your estate plans except as it pertains expressly to them.

   6. Reduced likelihood for a contest over your estate plan, due to increased privacy and expense of a contest.

Issues Having No Obvious Advantage between Using a Will vs. a Revocable Living Trust:     

Obtaining "The Best of Both Worlds"     

The situation is not really as "black and white" as presented.  In practice, anyone using a Revocable Living Trust as the vehicle for his/her estate planning will likely (and should) have a Will as well, among other things, to provide for situations that only a Will may provide, such as:

• Appointment of a list of Personal Representatives in priority order, in case a probate proceeding might be necessary or advantageous for some reason even upon the use of a Revocable Living Trust as one's primary estate planning vehicle.
   

• Appointment of a list of Guardians in priority order, perhaps even separate lists for Guardians of the Person and Guardians of the Estate, for any minor children.  
   

• Appointment of property subject to a Testamentary Power of Appointment.  
   

• Gifts of tangible personal property by a separate writing, not subject to their being made according to Will formalities.  

The Will used with a Revocable Living Trust is known as "Pour-Over" Will.  A Pour-Over Will will:

• Contain any of relevant provisions above and
   

• Provide that any property held at death by the Decedent/Trustor (ie, property that escaped being transferred into Decedent's Living Trust during life) to now be transferred (ie, "poured-over") into Decedent's Living Trust at death (technically, be transferred from Decedent's Personal Representative to Decedent's Trustee).

Practically speaking, you now see that in creating and implementing one's estate plans, the issue is:

• Not so much "Should I have a Will or a Living Trust?"
   

• As "Given that I should have a Will under any circumstance, should I also have a Living Trust as well?"

Bottom-line:

Query: What is the best vehicle to use to support one's estate plans?  A Will?  A Revocable Living Trust?  Or???