Pennsylvania adults who are preparing for the estate planning process likely have many questions. Some of the most common questions are regarding wills and trusts. Understanding the difference between each can help you to decide if you need to include either or both in your estate plan.
What is a will?
One of the most well-known estate planning tools is the will. This written document helps express a person’s wishes regarding what to do with their assets after their passing. A will allows a person to do multiple things, like name beneficiaries for certain assets and name guardians for any minor children they have.
After the death occurs, the will is submitted to probate court. From there, the executor of the will pays the deceased person’s debts and distributes the assets according to what was specified in the will. This process can take months or even years, depending on the size of the deceased person’s estate and whether the will is disputed.
What is a trust?
The main difference between a will and a trust is that a trust becomes active the day you create it. As a grantor, you list the distribution of your assets for your trust. There are many different types of trusts, with some of the most common being living trusts and irrevocable trusts. When assets are placed within a trust, they do not go through the probate process.
As you begin the estate planning process, it is important to understand some of the basic tools, like wills and trusts. You may want to consult an attorney during the estate planning process to ensure everything is done according to the laws in your state.