Wills vs. Trusts: Which Do You Need?

Choosing between a will and a trust is one of the most practical decisions in estate planning. Both documents dictate what happens to your property, but they operate differently, affect probate and privacy, and carry distinct costs and administrative burdens. This guide breaks down the differences, real-world uses, steps to implement, common mistakes, and practical checklists so you can decide which path suits your goals.

How a will and a trust differ in practice

• Activates: A will only takes effect after death; a trust can operate during life and after death (a revocable living trust can be used immediately).
• Probate: Wills typically must pass through probate, the court process that validates the will and supervises distribution. Trusts, when properly funded, usually avoid probate for assets titled to the trust.
• Privacy: Probate is a public court record. Trusts are private contracts and generally keep beneficiary and asset details out of public files.
• Control: Wills direct distribution and name executors and guardians. Trusts let a trustee manage assets, impose distribution conditions, and provide ongoing oversight.
• Costs: Wills are usually cheaper to draft; trusts cost more up front to create and fund but can save time and money by avoiding probate.
• Taxes: Neither a basic will nor an ordinary revocable trust avoids estate or income taxes on its own. Irrevocable trusts and specialized trust structures can be used for tax planning.

(Sources: IRS estate tax overview, Consumer Financial Protection Bureau resources on probate and estate planning.)

When a will is usually the right choice

A will is often appropriate when your estate is relatively simple and you want a straightforward mechanism to:

• Name an executor to settle your affairs
• Specify final distributions and personal bequests (e.g., family heirlooms)
• Appoint guardians for minor children
• Create testamentary trusts that only start at death (limited flexibility)

In my practice, many young families use wills to set guardianship and basic bequests while they delay more complex structures until net worth or family needs change.

Pros of a will

• Low initial cost and faster drafting
• Clear way to name guardians for minors
• Easier to update or revoke

Cons of a will

• Assets still go through probate, which can be slow and public
• Limited ability to control distributions over time or manage incapacity without a separate durable power of attorney

When a trust can be the better tool

Trusts are powerful when you need ongoing management, privacy, or probate avoidance. Common reasons to set up a trust:

• You own property in multiple states (to avoid ancillary probate)
• You want to keep transfers private
• You need a mechanism to manage assets if you become incapacitated
• You want to impose staged distributions for beneficiaries (e.g., at ages or milestones)
• You own a business and need continuity planning

Real-world example from my practice: a client with rental properties in three states created a revocable living trust and retitled the properties to the trust. This prevented three separate probate proceedings and simplified the trustee’s job after death.

Types of trusts and tax implications

• Revocable living trust: flexible, revocable, used primarily for probate avoidance and incapacity planning. Assets treated as owned by grantor for income and estate tax purposes.
• Irrevocable trust: often used for asset protection, Medicaid planning, or tax strategies. Once funded, the grantor gives up control and the trust may have different tax treatment.
• Special-purpose trusts: special-needs, charitable remainder, dynasty, GRATs — used for specific goals. See our deeper articles on trust types for details.

Useful internal reads: “Trust Types Compared: Which Trust Fits Your Goals?” and “Designing Flexible Trusts for Changing Family Needs“.

Probate, timing, and costs (practical outlook)

Probate timelines vary by state. Small estates may qualify for simplified or summary probate procedures, but larger or contested estates often take months to a year (or longer) to settle. Probate costs include court fees, executor or attorney fees, and costs to transfer title — those can add up and be a meaningful portion of the estate value.

Trusts require initial effort to “fund” (re-titling assets to the trust). Funding is the most common operational mistake: a trust that’s never funded still leaves assets to probate. A good estate plan often combines both: use a trust for major assets and a will as a “pour-over” to capture any leftover property.

(Helpful background: Consumer Financial Protection Bureau’s estate planning materials explain the probate process in lay terms.) Source: https://www.consumerfinance.gov/consumer-tools/estate-planning/
For federal tax guidance, see the IRS estate tax landing page: https://www.irs.gov/businesses/small-businesses-self-employed/estate-tax

Common mistakes clients make

• Failing to fund a revocable trust after signing it
• Believing a will avoids probate
• Ignoring beneficiary designations on retirement accounts and life insurance (these override wills or trust instructions unless payable to the trust)
• Not updating documents after marriage, divorce, birth, or major asset changes
• Appointing an incapable or uninterested trustee/executor without backup options

Practical checklist: steps to pick and implement

1. Inventory assets and ownership (deeds, bank accounts, retirement accounts, business interests, digital assets).
2. Review beneficiary designations and titling — update where necessary.
3. Clarify goals: probate avoidance, incapacity planning, tax minimization, privacy, special needs care, or business continuity.
4. Decide on primary tool: will, revocable trust, or a combination.
5. Draft documents with an estate attorney experienced in your state law.
6. Fund the trust: retitle accounts and property as needed; name the trust as beneficiary where appropriate.
7. Store originals and provide family/fiduciaries with access instructions; keep copies with your attorney.
8. Review every 3–5 years or after major life events.

Special situations and recommended approaches

• Minor children: Use a will to name guardians and a trust to hold funds and control distributions for education or other needs.
• Blended families: Trusts can preserve children’s inheritance while providing income to a spouse.
• Business owners: Use trusts and buy-sell agreements to ensure continuity and minimize disruption.
• Special needs beneficiaries: A properly drafted special-needs trust preserves public benefits while providing supplemental support. Read our article on special-needs planning for details.

Internal resource: “Planning for Special Needs Beneficiaries: Trusts and Public Benefits“.

Cost vs. benefit: how to evaluate

• Upfront legal fees are higher for trust-based plans. Expect a revocable living trust package to cost more than a simple will but often save heirs time and probate fees later.
• If privacy, speed, or multi-state probate are priorities, trusts are usually worth the extra cost.
• For modest estates with simple family situations, a will plus basic durable powers of attorney and healthcare directives may be adequate.

Frequently overlooked tax and account coordination items

• Beneficiary designations on 401(k)s, IRAs, and life insurance generally control distribution regardless of your will. Make sure these match your estate plan.
• Community property states and state tax rules can change outcomes; work with an attorney familiar with state law.
• Estate tax exposure is based on federal and state thresholds; check the current IRS guidance and your state revenue department for rules that may affect large estates.

Final recommendations

• Start with a clear inventory and written goals.
• Talk to an estate attorney for a plan tailored to your state laws and financial situation. This content is educational and not a substitute for legal advice.
• Use a will for guardianship and simple bequests; use trusts for privacy, probate avoidance, incapacity planning, and complex distribution rules.
• Keep documents updated and ensure beneficiary designations and account titling reflect your plan.

Professional disclaimer

This article is educational only and does not constitute legal advice. Laws and tax rules change; consult a qualified estate attorney or tax advisor about your specific circumstances. Sources used in this piece include the IRS (estate tax guidance) and the Consumer Financial Protection Bureau (estate and probate overviews).

Additional trusted reading

• IRS: Estate Tax — https://www.irs.gov/businesses/small-businesses-self-employed/estate-tax
• CFPB: Estate planning — https://www.consumerfinance.gov/consumer-tools/estate-planning/
• FinHelp related pages:
• Trust Types Compared: https://finhelp.io/glossary/trust-types-compared-which-trust-fits-your-goals/
• Designing Flexible Trusts: https://finhelp.io/glossary/designing-flexible-trusts-for-changing-family-needs/
• Designing an Ethical Will: https://finhelp.io/glossary/designing-an-ethical-will-communicating-values-alongside-assets/

If you want, I can add a printable one-page checklist or sample trust vs. will comparison table tailored to your state.