I take pride in personally crafting each of these emails. Unlike many others in the industry who rely on prewritten content, I write these myself from scratch. My goal is to boil down complex concepts and share relevant news in an easy-to-understand format. I hope you find them both informative and enjoyable.

Weekend Read: Wills vs. Trusts – Which One Is Right for You?

When it comes to estate planning, two of the most common tools people use are wills and trusts. Both are essential in ensuring that your assets are distributed according to your wishes, but they serve different purposes and come with unique benefits. Understanding the differences between them can help you make informed decisions about which option, or combination of options, is best for you.

What Is a Will?

A will is a legal document that outlines how your assets should be distributed after you pass away. In your will, you can specify who will receive your property and assets, name guardians for minor children, and appoint an executor to carry out your wishes. It’s important to note that a will goes through probate, a legal process where a court oversees the distribution of your estate. Probate can be time-consuming and costly, but it provides a formal process for resolving any disputes over the will. Last week I wrote a more detailed post on how to avoid probate which you can read here.

Wills are relatively straightforward and are a good option if your estate is simple. However, they may not offer the flexibility that some individuals require, especially if you want to moderate the distribution and use of your assets1.

What Is a Trust?

A trust is a legal arrangement where you (the grantor) transfer ownership of your assets to a trust, managed by a trustee, for the benefit of your beneficiaries. Unlike a will, a trust can be effective during your lifetime and after your death. One of the main advantages of a trust is that it allows your assets to avoid probate, meaning they can be distributed to your beneficiaries more quickly and privately.

There are several types of trusts, but two of the most common are revocable living trusts and irrevocable trusts. A revocable living trust allows you to retain control over your assets during your lifetime, and you can modify or revoke the trust at any time. An irrevocable trust, on the other hand, cannot be changed once it’s established, but it offers potential tax benefits and protection from creditors2.

When to Use a Will

Wills are a good choice when you have a straightforward estate, and you want to name guardians for minor children or specify your funeral arrangements. If your primary concern is ensuring that your assets are distributed according to your wishes and you’re not worried about probate, a will may be sufficient. Additionally, wills are more cost-effective to create and maintain compared to trusts1.

When to Use a Trust

Let’s say you own several properties, have significant investments, and want to ensure that your assets are managed carefully after you're gone. You’re also concerned about your children inheriting such a large amount of money at a young age or before they’re ready to handle it responsibly. In this case, a trust could be a great solution. A trust allows you to set specific terms for when your children can access their inheritance—like waiting until they’re older or specifying that the money is used for particular purposes, such as education or starting a business. This gives you control over how and when they receive their inheritance, helping to ensure that your hard-earned wealth is used wisely. Plus, a trust keeps your financial matters private and can offer additional protection from creditors. 

This way, you can have peace of mind knowing that your assets will be managed according to your intentions and that the money will be a blessing not a burden2.

Combining Wills and Trusts

Combining a will and a trust can give you the most complete estate plan. A trust helps you avoid probate and keeps your financial details private, while a will ensures that anything not covered by the trust—like personal items or assets you acquire later—is still handled according to your wishes. Plus, a will lets you name guardians for your minor children, which a trust alone can’t do. By using both, you can be confident that every aspect of your estate is covered. This approach offers flexibility, privacy, and the peace of mind that your assets and loved ones will be taken care of exactly as you planned3.

Conclusion

Deciding between a will, a trust, or using both really comes down to your unique situation. If you’re not sure which option is best for you, it’s a good idea to talk it over with an estate planning professional and your financial advisor. They can help you create a plan that fits your needs and ensures your loved ones are taken care of the way you intend.

If you have any questions about estate planning or need help deciding between a will and a trust, feel free to reach out to me by phone or email. I’m here to help.

If you’ve only recently joined my email list, you’ve missed out on many insights and updates that I've been sharing each week. Be sure to visit my blog to explore past content that you might find valuable.

Jeremy Raffer, MBA
Director & Wealth Manager
Author “Financial Planning for Widows”

m. 201-747-2705
w. rafferwealthmanagement.com
e. jeremy.raffer@stewardpartners.com

Steward Partners
115 W. Century Rd, Suite 145
Paramus, NJ 07652.

1https://www.investopedia.com/articles/pf/08/what-is-a-will.asp

2https://www.investopedia.com/ask/answers/071615/what-difference-between-revocable-trust-and-living-trust.asp

3https://www.investopedia.com/articles/personal-finance/051315/will-vs-trust-difference-between-two.asp

The views expressed herein are those of the author and do not necessarily reflect the views of Steward Partners or its affiliates.  All opinions are subject to change without notice.  Neither the information provided nor any opinion expressed constitutes a solicitation for the purchase or sale of any security.  Past performance is no guarantee of future results.

Steward Partners Investment Solutions, LLC (“Steward Partners”), its affiliates and Steward Partners Wealth Managers do not provide tax or legal advice. You should consult with your tax advisor for matters involving taxation and tax planning and their attorney for matters involving trust and estate planning and other legal matters.

AdTrax 6934530.1 Exp 8/25