"Do I need a will or a trust?"
It's one of the most common questions we hear at Legacy Buddy, and for good reason. The difference isn't always clear, and the stakes feel high because they are. Make the wrong choice, and your family could end up spending thousands in probate costs or facing complications you never intended.
Here's the good news: understanding the basics isn't as complicated as the legal profession might have you believe. And better yet? You might not have to choose between them at all.
Let's break it down in plain English, no law degree required.
The Quick Take
If you're short on time, here's the simplified version:
Wills tell the world who gets your stuff and who takes care of your kids after you're gone. They go through probate court, which means they become public record and can take time to process.
Trusts are more like private transfer instructions that take effect immediately if you become incapacitated and avoid the probate process when you pass away. They typically cost more to set up but can save your family significant time and money later.
Many people actually need both, they serve different but complementary purposes. Now let's dig deeper.
Wills: The Fundamental Building Block
A last will and testament is essentially a set of instructions that takes effect after your death. It's the estate planning equivalent of leaving a detailed note for your loved ones.
What a will does:
- Names your beneficiaries (who gets your stuff)
- Appoints guardians for minor children (arguably the most important function for parents)
- Names an executor (the person who will carry out your wishes)
- Can create a testamentary trust (a trust that only forms after your death, often used for minor children's inheritances)
- Can specify funeral wishes (though separate funeral direction documents are often better)
Josh, a Legacy Buddy customer from Oregon, told us: "As a single dad, knowing my daughter would be raised by my sister if anything happened to me gave me enormous peace of mind. That alone made creating a will worth it."
The limitations of wills:
- They must go through probate – the court-supervised process of validating the will and distributing assets
- They become public record – meaning anyone can see what you owned and who received it
- They only take effect after death – they provide no protection if you become incapacitated
- Probate can be expensive and time-consuming – in some states, it can take months or even years and cost 3-7% of your estate value
This is why relying solely on a will, especially if you own property or have substantial assets, often isn't the most efficient approach.
Trusts: The Privacy and Efficiency Upgrade
A trust is essentially a legal arrangement where you transfer assets to a trustee (often yourself while you're alive) to hold for the benefit of your chosen beneficiaries. Think of it as creating a separate legal entity that holds your stuff according to your specific instructions.
What a trust does:
- Avoids probate – assets in the trust pass directly to beneficiaries without court involvement
- Maintains privacy – unlike wills, trusts aren't public record
- Works during incapacity – if you become unable to manage your affairs, your successor trustee can step in without court intervention
- Can include specific conditions – like distributing assets to children at certain ages or upon achieving certain milestones
- May reduce estate taxes – depending on the type of trust and your situation
Maria and Carlos, a couple from Florida, shared: "After watching my parents' estate get stuck in probate for 18 months, we decided to set up a trust. The peace of mind knowing our kids will have immediate access to what they need without courts involved is priceless."
Types of trusts:
There are many specialized trusts, but the most common is the Revocable Living Trust, which:
- Can be changed or revoked during your lifetime
- Allows you to maintain control of your assets while you're alive
- Becomes irrevocable (unchangeable) when you pass away
- Provides seamless transfer of assets upon death
Other types include irrevocable trusts, special needs trusts, charitable trusts, and asset protection trusts, each designed for specific situations and goals.
The limitations of trusts:
- They require more upfront setup – you need to create the trust document and then transfer assets into the trust's name (called "funding" the trust)
- They typically cost more initially – though they often save money in the long run by avoiding probate
- They need to be maintained – as you acquire new assets, you need to title them in the trust's name
- They don't name guardians for minor children – you still need a will for this critical function
Why Many People Need Both
For many families, the ideal solution is having both a will and a trust, working together as a comprehensive estate plan. Here's why:
- A trust handles asset transfers efficiently, avoiding probate and maintaining privacy
- A will serves as a "backup" for any assets that weren't transferred to your trust
- Only a will can name guardians for minor children
- A will can include a "pour-over" provision that catches any forgotten assets and directs them to your trust
Think of your will as your base layer of protection, with a trust adding an extra layer of efficiency and control.
Which Do You Need? Ask Yourself These Questions
Every situation is different, but these questions can help guide your decision:
- Do you have minor children?
- You definitely need a will to name guardians.
- Do you own real estate or have assets worth more than $100,000?
- A trust likely makes sense to avoid probate costs and delays.
- Do you value privacy regarding your assets and who receives them?
- A trust keeps your estate private, while a will becomes public record.
- Do you want to leave assets with specific conditions?
- A trust gives you more control over how and when beneficiaries receive assets.
- Are you concerned about potential incapacity before death?
- A trust allows your successor trustee to step in without court intervention.
- Is your estate situation straightforward with minimal assets?
- A simple will might be sufficient.
The Cost Factor: Short-Term vs. Long-Term
One of the biggest differences between wills and trusts is the cost structure:
Wills typically cost less upfront but may lead to significant probate expenses later (often 3-7% of your estate value plus court costs and attorney fees).
Trusts usually have higher initial costs but can save substantial money by avoiding probate entirely.
This is where Legacy Buddy's approach really makes a difference. Traditional estate planning with attorneys can cost thousands upfront, with additional charges every time you need to make updates. Our online platform offers both wills and trusts at a fraction of the traditional cost, with unlimited free document updates included in every package.
Real-World Examples: What Works for Different Situations
Young Couple, No Kids, Renting
Sarah and Mike are in their late 20s, rent their apartment, and have modest savings and retirement accounts.
Recommendation: Start with a simple will, advance healthcare directives, and powers of attorney. They can upgrade to a trust later if they buy property or have children.
Parents with Minor Children
Jessica and David have two children under 10 and own a home with a mortgage.
Recommendation: They need a will to name guardians for their children, plus a revocable living trust to hold their home and other assets, avoiding probate and ensuring immediate access to funds for childcare if something happens to them.
Single Professional with Substantial Assets
Marcus is a 45-year-old executive who owns multiple properties and has significant investments.
Recommendation: A revocable living trust is essential to avoid probate on his various properties and investments, along with a pour-over will to catch any assets not transferred to the trust.
Blended Family
Robert and Elena each have children from previous marriages and want to ensure all children are provided for.
Recommendation: A trust provides the detailed control needed for blended families, allowing specific provisions for different beneficiaries while avoiding potential conflicts.
The Biggest Mistake People Make
The worst estate planning mistake isn't choosing the wrong document, it's failing to keep your plan updated. Life changes constantly: marriages, divorces, births, deaths, moves to new states, purchasing homes, starting businesses.
Traditional estate planning makes updating documents expensive and inconvenient, so most people simply don't do it. Their outdated documents then create exactly the problems they were trying to avoid.
That's why unlimited free document updates are built into every Legacy Buddy package. Your estate plan should evolve as your life does, without costing you hundreds of dollars each time something changes.
Taking the Next Step
The "right" choice between a will and trust depends entirely on your individual situation. But here's what we know for certain: having either is vastly better than having nothing at all.
Ready to get started? Legacy Buddy makes creating your estate plan simple and affordable.
