What's the Difference? Wills vs. trusts
The guide gives a general description of the differences between wills and trusts.
WillsA will is a document that sets out how you would like your estate disbursed upon your death. If someone passes away and they have a will, it most always needs to be presented to the probate court in the county in which the decedent was living at the time of their death. Wills are public knowledge; meaning once it is filed for probate, anyone can go into the probate court and read it. This may present problems sometimes if someone who thought they were going to be a beneficiary wasn't, and they want to know where there share went (if the executor didn't tell them.) When a beneficiary is given something through a will (being money, property, real estate, etc.), they cannot receive that gift until the executor is appointed by the court. For example, if I gave my daughter a diamond ring in my will, she cannot legally "own" that ring until the executor is appointed by the probate court. Depending on the county the decedent lived in, that could be at least 3-6 weeks. There are also fees associated with filing petitions to probate wills. Even though they may not be astronomical (generally under $200.00) many people do not want to have to pay those fees to the government. While every estate plan should include a will, there are compelling reasons that one might want to create a trust as well.
TrustsTrusts can be invaluable instruments for handling more complex estate plans. Trusts can take title to most anything that is appraisable and of monetary value. Granny's vintage handkerchief collection may hold sentimental value to you, but unless they were made by Betsy Ross, they most likely aren't of monetary value. In Georgia, trusts aren't allowed to take title to real property. However, trustees can hold that property in their name for the trust. Thus, if someone has a home outside their state of residence, it is best to have that property be held in a trust so that it will pass directly to the beneficiaries without having to go through probate. That is the major difference between a will and a trust. In opposition of a will, a trust does not have to be presented to the probate court (unless it's being contested.) Because of this, trusts are private; meaning no one in your family has to know who the beneficiaries are of the trust unless you (or the trustee) tells them. So, based on the example above, if I gave my diamond ring to my daughter via my trust, upon my passing the trustee could give it to her immediately. There are various types of trusts, the most common being a revocable living trust. Other types include special needs trusts, charitable remainder trusts, irrevocable life insurance trusts, etc.