Attorney Articles - Comparison of Wills vs. Living Trusts

Attorney Article - Comparison of Wills vs. Living Trusts

In order to express one’s wishes as to asset disposition at death, most people choose between a Will and a Living Trust. There are numerous pros and cons of either choice. A Will is usually a simpler document and is therefore less expensive to create. However, a Will must go through probate, which is the court-supervised process for making sure a decedent’s legitimate debts are properly paid, and that all assets are properly valued and distributed to the intended parties. Probate records are open to the public. A Living Trust generally avoids probate. Many people think of probate as an expensive, time wasting process, and they choose to avoid probate through a Living Trust. The major distinctions between a Will and a Living Trust are summarized below.

		WILL & PROBATE	LIVING TRUST
1.	Legal Fees to Establish for Married Couple	$600-$1200 for Wills	$1500-$3000, plus expense of asset transfers into Trust
2.	Legal Fees to Administer upon Death	Typically $3000-$5000	Typically $1000-$2000
3.	Settlement Time upon Death	About 5-6 months in nontaxable estate; over 10 months if taxable estate	About 1-2 months in nontaxable estate; over 10 months if taxable estate
4.	Protection of Privacy	No - Probate records are public	Yes - No public filings normally
5.	Court Supervision of Collecting & Valuing Assets & Paying Debts	Yes	No
6.	Asset Valuation Required	Yes - Inventory must be filed at court	Not required, unless taxable estate
7.	Complexity During Life Time	Minimal or none	Significant - must be sure all assets are owned by Trust
8.	Tax Savings (Income or Estate Taxes)	No difference	No difference
9.	Claims and Debts Cut-off	4 months from start of probate	Usually 6 years from non-payment
10.	Property Tax Deferral (Senior Citizens)	No impairment	Disqualifies home
11.	Out-of-State Property	Ancillary court proceedings are necessary in each state	One single trust can include all assets wherever located
12.	Vehicle for Financial Management if Disabled	No - Must get court-appointed conservator	Trust is ideal vehicle to provide continuous financial management by successor trustees

Consult a Knowledgeable Attorney

The above list is a simple overview of the main differences between Wills and Living Trusts. For additional information on these and other differences, numerous articles and other information are available at various websites. For the most reliable advice, you should confer with an experienced estate planning attorney.

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For more information or questions, please contact Steven R. Bennett at 503-228-8588 or by email at srb@pmblaw.com.

Article revised: 11/10/09

Copyright © 2009 Powers McCulloch & Bennett. All Rights Reserved. The contents of this article are intended for general information only and should not be construed as legal advice or opinion on specific facts and circumstances.

Powers, McCulloch & Bennett, LLP
PMB Law is a Portland, Oregon law firm representing and advising individual and business clients throughout Oregon. Our firm was founded in October of 1973 and we have over eighty-five years of combined legal experience.