We often get asked whether a last will and testament is “good enough,” or whether a comprehensive estate plan might better serve the client and their needs. 

The short answer: it depends on your circumstances.

The longer answer: it’s important to do your research.

Here, we break down the differences between having a will versus having a comprehensive estate plan.

What is a Trust vs Will?

In Texas, having a will and having a trust (aka a complete estate plan) are two different approaches to handling your assets and personal affairs after your death or in cases of incapacity. 

Here’s a quick breakdown of both options:

Will

A will is a legal document that specifies how you want your assets distributed after your death. However, it only addresses certain aspects of estate planning.

Here are some key features of a will:

• Asset Distribution: Specifies who will receive your property and assets after your death.
• Executor Designation: Names someone to carry out your instructions and manage the estate’s probate process.
• Guardianship for Minor Children: Wills can designate guardians for minor children if both parents are deceased.
• Probate: The will must go through probate court, a legal process where the court validates the will and oversees asset distribution. Probate can be time-consuming and public, and is rarely a simple process for the bereaved.
• Limited to Death: A will takes effect only after your death and does not provide protections or instructions if you become incapacitated. 

Trust (Complete Estate Plan)

A complete estate plan (typically referred to as a trust) addresses various aspects of your finances, health, and personal affairs. It often includes multiple documents that provide protection and control before and after your death.

Here are the key features of a complete estate plan:

• Will: Includes the key elements mentioned above.
• Trust: There are several types of trusts you could put in an estate plan. One of the most popular, a revocable living trust, allows you to transfer assets into the trust during your lifetime. Upon your death, the assets are distributed according to the trust’s terms, often bypassing probate. It can also be managed if you become incapacitated.
• Powers of Attorney: This appoints someone to handle your financial affairs if you become incapacitated.
• Medical Power of Attorney: Names someone to make healthcare decisions if you become unable to do so.
• Advance Directive (Living Will): Specifies your medical treatment preferences if you are terminally ill or in a permanent vegetative state.
• HIPAA Authorization: Allows specific people to access your medical records due to laws.
• Beneficiary Designations: Ensures accounts like retirement accounts or life insurance have up-to-date beneficiaries, avoiding probate.
• Disposition of Remains and Funeral Instructions: Specifies your wishes regarding burial, cremation, or other final arrangements.

That said, readers should beware of going the DIY route for either wills or trusts.

Key Differences Between a Trust vs Will

So what are the biggest differences between a living trust vs will?

Let’s break it down in the sections below:

• Probate: A will must go through probate, while a living trust (part of an estate plan) can avoid probate, making it quicker, private, and won’t require a probate lawyer.
• Incapacity Protection: A will only takes effect after death. An estate plan provides for your care and asset management if you become incapacitated while alive.
• Comprehensiveness: A will only handles asset distribution. However, an estate plan provides a holistic approach to managing your assets, healthcare, and financial decisions in life and death.
• Privacy: A will becomes a public record through probate, while a living trust and other estate planning documents can remain private.

To summarize: wills are typically shorter documents that are less comprehensive and focus on end-of-life wishes. Trusts, on the other hand, are thorough and comprehensive, and encompass your wishes both while alive and after your passing.

Will vs Trust: Which is Better?

Making the choice between a will and a trust largely comes down to personal preference. 

If you do not plan to leave a large estate, you could choose to settle for a will. Dying without a will could be disastrous, so it’s important to have at least some layer of protection for your heirs.

That said, creating a trust through comprehensive estate planning may be a more effective option for long-term care. Since heirs do not pay estate or inheritance tax in Texas, you do not need to worry about losing chunks of your nest egg.

Keep in mind that the cost of a trust may be higher than the cost of a will. It’s also much harder to DIY a trust or create a trust online, as you may create errors that don’t surface until it’s much too late.

Regardless of whether you choose a trust or a will, you should consult an experienced estate planning or probate lawyer about the best option for you.

Looking for information on a transfer on death deed? Read here.

Conclusion: Selecting the Perfect Plan for Your Needs

In Texas, if you want a more thorough plan that protects you during your lifetime and ensures smoother transitions after death, a complete estate plan is a more robust solution than just having a will.

Not sure which option is right for you?

You’re invited to call Thomas-Walters, PLLC for a free consultation at 817-258-5908.

Frequently Asked Questions About Trusts vs Wills

What happens if I lose a trust or will document?

If you lose a will or trust document, you should immediately contact the attorney who helped to draft the comprehensive estate plan. You can also check financial institutions and country recorder offices. If you still cannot find your document, you may need to petition the probate court.

What are the different types of trusts I can make?

There are several types of trusts in Texas, including:

• Revocable living trust
• Irrevocable trust
• Testamentary trust

It’s a good idea to chat with an estate attorney about the option that’s right for you.

Is a trust better than a will?

Assets in a will may need to pass through probate court, which could be time-consuming, frustrating, and public. In contrast, an estate left in a trust doesn’t need to go through probate court. It may be easier to distribute assets both quickly and privately.