This is a question that goes back in time, which is better, a will or a living trust?. I am in a unique position with the ability to share my own actual experience in answering this question. Why is that? Because I was chosen on two separate occasions, by two different relatives in my family, to oversee and distribute their estates after they passed away. One of the relatives named me as an executor of their Will and the other as the successor trustee of their living trust. I discovered the hard way, there is a huge difference between the two documents. And, that difference has to do with the authority and powers each document gave me in order to settle the estate, transfer the assets, and distribute the inheritance.
As the executor of the Will, I had to work my way through the probate court system in the county where my relative lived. This involved going to court, filing paperwork, and paying the filing fees to create a probate case. I looked into hiring an attorney to deal with it, but the best price I could find wanted 3% of the value of the entire estate, in advance, to handle the court matters. Once the probate case was created, the court scheduled a date and time that I had to return to hear my case. After the hearing, I was required to post-death notices in that county’s newspaper, which made some of our private information public. Along the way, I periodically had to appear in court to provide updates. Further, I had to be accountable for every action I took and there was a strict deadline for when each step had to be accomplished. I had no real control, and I was under the watchful eye of the court with each step. It required 11 trips to her county’s probate court so that I could report on each step of the process and get the court’s approval. Now with the court being as busy as it is, my simple probate case almost took 2 years to get to the point that I could distribute the assets to the beneficiaries. In the end, it cost the estate well over $14,000 to get it through this probate process.
During the time I was working with the court to probate the estate, another relative passed away. She had created a Revocable Living Trust to pass on her estate. Towards the end of her life, she developed Alzheimer’s Disease and she couldn’t help herself. The living trust portfolio also included both a financial and a medical power of attorney. These two powers gave us the authority and ability to make sure her bills were paid and to communicate with her doctor for her medical needs. It made caring for her easier until she passed away.
Once I had the trust in my possession, I had total authority to deal with finalizing the estate. I could deal with the banks. I could hire contractors to help with things that needed to be done. I was able to distribute all of the special gifts she left to various relatives and organizations dear to her. Once those gifts were settled, I was able to plan an estate sale. After that, I was to give her estate to her beneficiaries. One of her beneficiaries needed a special type of account set up, and I was able to just go to my local bank and set up the account. The only government interaction I had was dealing with Social Security and the IRS. Neither of those took more than a short period of time to take care of. Because I was the successor trustee, they treated me professionally and quickly. The entire trust estate only took a little over 2 months to resolve. The costs were minimal and directly related to the end goal, the distribution of the estate. The best part is that I could deal with the estate when I had time available. I didn’t have to make any court appearances or wait for any court decisions and rulings.
After going through these two different experiences, I now have an estate plan complete with powers of attorney. And because it is a revocable living trust, I am the controlling person during my lifetime. I can manage my estate as I want. I am free to make changes to the trust anyway and at any time I wish. When I buy or sell a home, for example, I can do it just as easily as before I had a living trust. The new property can simply be titled into the name of the trust. The trust is designed to make managing my assets an easy process.
Getting back to the original question of which is better, a Will or a living trust?
I have learned through my own experience that control and authority is the question. For people who don’t mind losing a part of their estate to attorney fees and court costs, a Will is the way to go. But for the rest of us, it is not. I want my named successor trustee to be able to deal with my estate without seeking a court’s permission and without having to be beholden to a lengthy court schedule. After all the bills are paid from the estate, I want my beneficiaries to get as much as possible. As my friends and family are mourning my loss, I want them to have as little trouble as possible. My revocable living trust gives me peace of mind knowing that my instructions to my successor trustee are the only instructions they will need in handling my final wishes. So, is a living trust better than a Will? That year for Christmas I paid for my mom and brother to both establish their own living trusts. I will never ask a person to go through the probate process in my name, nor do I want them to ask me to do it for their estates. In my experience, a living trust is definitely the better way to go.
If you would like to learn how to obtain peace of mind and an affordable living trust at a price of only $799 (no hidden fees), click the button below in the footer of our website
