Two critical legal arrangements in estate planning are wills and trusts. Both tools allow you to distribute your assets to heirs after you pass.
Though they have similar goals, there are important differences between them. These differences provide the key to why you should have both.
How are wills and trusts different?
When you create a will, you make your wishes known for where you would like your assets to go after you pass. A will becomes effective after you die. However, Florida law requires wills to pass through probate before your heirs receive their inheritances. Probate proceedings are public, allowing others to contest the validity of your will.
Trusts place your assets into a legal holding managed by a trustee. It becomes effective as soon as you create it, and if you name yourself as its trustee, you maintain control over your assets while you are still alive. A trust does not go through the probate process. Instead, your heirs receive their inheritance quickly, though there are still routes for others to contest your wishes.
Why do you need both?
Trusts provide the benefits of expediency and cost savings. However, they are more complex, requiring ongoing maintenance and updates. They are also not as detailed as a will. A will provides more flexibility in relaying your wishes.
If specific assets are not held in the trust, a will can relay how you wish those assets to be distributed. Furthermore, if you have young children, a will allows you to name a guardian for them if you pass before they become adults.
Wills and trusts protect your assets and provide tools to reveal how you want them distributed. The two can work together to increase assurances in estate administration after you pass.