What Is a Living Trust Versus a Will?
If you’ve ever wondered what happens to your home, savings, and personal belongings after you pass away, you’re asking the right question. The answer usually involves two estate planning documents: a will and a living trust.
Most people assume they need one or the other. The reality is different. Understanding the key differences between wills and living trusts helps you build a comprehensive estate plan that protects your family and reflects your final wishes.
In this guide, you’ll learn exactly how each document works, when each makes sense, and how they can work together to protect your assets and the people you care about.
Quick answer: Living trust vs. will in plain English
Here’s the core difference in simple terms: a will only takes effect after your death and typically must go through probate, a court supervised process that can take months. A revocable living trust, on the other hand, can manage assets during your lifetime, step in if you become incapacitated, and distribute assets after you die—often without any court involvement.
The main differences at a glance:
Timing: A will has no power until you die. A living trust takes effect immediately once you sign and fund it.
Probate: Wills typically must go through probate court. Living trusts usually avoid probate entirely.
Privacy: Wills become public record once filed with the court. Living trusts remain private documents.
Incapacity planning: A will does nothing if you become incapacitated. A living trust allows a successor trustee to manage assets without court intervention.
Example with specific dates:
If Alex signs a will in 2025, that document sits dormant until Alex dies. If Alex suffers a stroke in 2028 and can’t manage finances, the will provides no help—a court may need to appoint a conservator. When Alex eventually passes away, the executor must file the will with probate court, where it becomes part of the public record.
If Alex instead creates and funds a living trust in 2025, the trust is active immediately. If Alex becomes incapacitated in 2028, the named successor trustee steps in to manage trust assets without any court involvement. At death, the trustee can distribute assets to beneficiaries privately, often within weeks rather than months.
For most people, the choice isn’t “will or trust.” It’s “will and (possibly) trust” working together as part of one estate plan.
What is a will?
A last will and testament is a legal document that directs what happens to your property after you die. It has no legal power while you’re alive and only becomes effective at your death.
What a will typically covers
Real estate (homes, land, rental property)
Vehicles
Bank accounts and investment accounts held in your name
Personal property like jewelry, furniture, and collectibles
Digital assets
Any other property you own individually at death
Key features of a will
A will lets you name an executor (sometimes called a personal representative) who handles your estate after you pass away. This person files the will with the probate court, pays your debts, and eventually distributes remaining estate assets to your beneficiaries.
A will is also where you appoint guardians for minor children. This is critically important for parents—only a will can formally name who should raise your children if both parents die. Living trusts cannot do this.
You can also include funeral arrangements and end of life wishes in your will, though many people handle these in separate documents.
Requirements and process
In most U.S. states in 2025, a valid will must be:
Written (typed or handwritten in some states)
Signed by you
Witnessed by two adults who aren’t beneficiaries
Electronic wills are gaining acceptance but remain limited to certain jurisdictions.
If you only have a will, your estate will normally go through probate—a court supervised legal process that validates your will, allows creditors to make claims, and oversees asset distribution. Depending on your state and the complexity of your estate, probate proceedings can take anywhere from six months to over a year.
What is a living trust?
A revocable living trust is a legal arrangement you create while you’re alive. You transfer ownership of your assets into the trust and provide instructions for how they should be managed during your life, during any incapacity, and after your death. Transferring assets into a living trust involves time, effort, and legal considerations, as ownership of assets changes once they are transferred.
Key roles in a living trust
Grantor (also called settlor or trustor): You, the person who creates the trust
Trustee: The person who manages trust assets. Most people name themselves as initial trustee to keep full control.
Successor trustee: The person who takes over if you become incapacitated or die
Beneficiaries: The people or organizations who receive the trust assets—your spouse, children, charities, etc.
How it works in practice
You appoint a successor trustee (a trusted family member, friend, or professional) who steps in if you become incapacitated or when you pass away.
This successor trustee arrangement is one of the most valuable features. There’s no need for a court to appoint someone to manage your financial decisions if you can’t—the transition happens automatically.
A revocable trust can be changed or fully revoked during your lifetime, as long as you have mental capacity. By contrast, an irrevocable trust cannot be altered or revoked once established, so it is important to consult a lawyer before creating such a trust. This flexibility disappears at death, when the trust typically becomes irrevocable.
Funding the trust is essential
Here’s something critical that trips up many people: a living trust only controls assets that are actually transferred into it.
This process, called “funding,” requires retitling assets. For example:
A house deed changes from “Jane Doe” to “Jane Doe, Trustee of the Jane Doe Living Trust dated March 1, 2025”
Bank accounts and investment accounts are retitled to the trust
Beneficiary designations on life insurance may be updated
Retirement accounts like 401(k)s and IRAs are usually not retitled into a living trust. They pass via beneficiary designations instead. Confirm the right approach with a tax or estate attorney before making changes.
Unlike a will, a properly funded living trust can avoid probate. Administration after death is handled privately by the trustee rather than in open court. This saves time, reduces costs, and keeps your affairs out of public record.
Key differences between a living trust and a will
Both trusts and wills are essential estate planning documents, but they work very differently. Here’s a breakdown of the main differences:
A testamentary trust is another important estate planning tool. Unlike a living trust, a testamentary trust is created through a will and only takes effect after the person’s death. It is used to manage and distribute assets to beneficiaries over time, offering flexibility in how and when assets are provided. This differs from a living trust, which is established and can be managed during the grantor’s lifetime.
Timing of effectiveness
Will: Has no legal power until you die. It’s just a piece of paper while you’re alive.
Living trust: Becomes effective immediately when signed and funded. Works during your life, during incapacity, and after death.
Probate requirements
Will: Must be filed with probate court after death. Probate can take 6-18 months and cost 3-7% of estate value in fees.
Living trust: Assets held in the trust typically pass outside probate. Distribution can happen in weeks, not months.
Privacy considerations
Will: Becomes part of the public probate file. Anyone can look up what you owned, who inherited it, and the details of your estate.
Living trust: Remains a private document. Only trustees and beneficiaries need to see the details.
Incapacity planning
Will: Provides zero help if you become incapacitated. A court may need to appoint a conservator to manage your finances—a costly process that can run $3,000-5,000 per year plus court fees.
Living trust: Your successor trustee can immediately step in to manage trust assets without any court involvement.
Guardianship for children
Will: This is the only document that can formally appoint guardians for minor children or dependents.
Living trust: Cannot name guardians. However, it can provide detailed instructions for how money should be managed for children until they reach adulthood.
Control and customization
Will: Wills typically result in outright distributions after probate. Once assets transfer, beneficiaries have full control.
Living trust: Allows staggered distributions (for example, 25% at age 25, 25% at 30, balance at 35) and can protect assets for beneficiaries with special needs without disqualifying them from government benefits.
Cost and complexity
Will: Cheaper and easier to prepare upfront. A simple will might cost $200-1,000 to draft.
Living trust: Higher initial cost ($1,500-3,000 or more), plus the time-consuming work of funding it properly. However, avoiding probate often saves money in the long run.
Tax treatment
A standard revocable living trust does not change your income tax or estate tax situation during your lifetime. You report trust income on your personal tax return. For estate tax purposes, both wills and revocable trusts qualify for the same exemptions.
Irrevocable trusts offer potential tax benefits but are a separate topic with different tradeoffs.
Living trust vs. will: Which is right for you?
There’s no one-size-fits-all answer. The “right” choice depends on your goals, your state’s laws, and the size and complexity of your estate.
When a revocable living trust often makes sense
Consider a living trust if you:
Own real estate in multiple states (avoiding probate in each state saves significant time and money)
Want to keep your estate details completely private
Are concerned about potential incapacity and want seamless financial management
Have a blended family with children from prior relationships and need precise control over who gets what
Own a complex estate with business interests, investment property, or assets with sentimental value that require careful handling
When a will alone might be enough
A will may suffice if you:
Have a smaller estate below your state’s simplified-probate threshold (often under $166,250 in 2024)
Have very straightforward beneficiary arrangements (everything to spouse, then equally to children)
Are working with a limited budget in the short term
Have most assets already passing outside probate via beneficiary designations (retirement accounts, life insurance, joint accounts)
The reality for most people
Many people in 2025 use both documents together:
A living trust for major assets like real estate and investment accounts
A pour over will that catches any assets left outside the trust and directs them into it at death
Note that assets “poured over” through this type of will still go through probate. The pour over will acts as a safety net, not a probate-avoidance tool.
Think concretely about your situation: your age, marital status, whether you have children, home ownership status, business interests, and whether anyone depends on you financially or medically.
Because state law varies significantly on probate thresholds and procedures, consult an estate planning attorney licensed in your state. Laws in California, Texas, Florida, and New York all differ in meaningful ways.
Do you need both a will and a living trust?
A living trust does not replace the need for a will in most real-world plans. They serve different, complementary purposes.
Why you still need a will even with a trust
Even if you fund a revocable living trust with most assets, you still need a pour over will to:
Handle any asset you forget to retitle into the trust
Catch unexpected inheritances you receive shortly before death
Transfer tangible personal property like jewelry, art, or items with sentimental value that weren’t specifically funded
Only a will can name guardians
This point is worth repeating: only a will can formally nominate guardians for minor children or dependents. Your living trust can direct how money for them is managed and when they receive distributions, but it cannot confer parental responsibility.
Your complete estate planning checklist
A comprehensive estate plan in 2025 typically includes:
Last will and testament (or pour-over will if you have a trust)
Revocable living trust (if appropriate for your situation)
Durable financial power of attorney (for financial decisions if incapacitated)
Healthcare power of attorney (to make medical decisions on your behalf)
Advance healthcare directive or living will (for end-of-life medical wishes)
A living will (medical directive) is completely different from a last will and testament. Don’t let the similar names confuse you.
An integrated plan—will, possibly a living trust, and supporting documents—offers the best chance your wishes will be followed efficiently, privately, and with minimal burden on your family.
Real-world examples: How wills and living trusts work in practice
Seeing these documents in action makes the differences clearer. Here are three scenarios showing how each approach works.
Scenario 1: Will only
Jordan dies in 2026 owning a house worth $450,000, a checking account with $35,000, and a car—all held in Jordan’s individual name. Jordan has a valid will naming a sister as executor and two adult children as beneficiaries.
What happens: Jordan’s sister files the will with probate court. The court validates the will and oversees the probate process. The sister must inventory all assets, notify creditors, pay outstanding debts, and file tax returns. After the court approves final distributions (typically 9-12 months later), the remaining property transfers to Jordan’s children. The entire process becomes public record, and probate fees consume roughly $15,000-25,000 of the estate value.
Scenario 2: Living trust plus pour-over will
Maria creates and funds a revocable living trust in 2024. She transfers her home (worth $500,000) and her brokerage account ($300,000) into the trust, naming herself as trustee and her daughter as successor trustee. She also signs a pour-over will to catch anything she misses.
Maria keeps a small bank account ($8,000) in her own name, meaning to transfer it but never getting around to it.
What happens when Maria dies in 2030: Maria’s daughter, as successor trustee, immediately takes control of the trust assets. There’s no court involvement. She follows the trust instructions to distribute assets to Maria’s three grandchildren over a period of years. The house and investment accounts transfer within weeks, privately.
The $8,000 bank account in Maria’s personal name goes through a simplified probate proceeding via the pour-over will. Once probate completes, that money “pours” into the trust and is distributed according to trust terms. Total probate exposure is minimal.
Scenario 3: Incapacity with a living trust
Robert creates a living trust in 2025, funding it with his home and financial assets. He names his son as successor trustee.
In 2028, Robert suffers a severe stroke and cannot manage his affairs.
What happens: Robert’s son immediately steps in as trustee to manage trust assets—paying bills, managing investments, handling property decisions. There’s no need for a court-appointed conservator. The transition is seamless and private.
Compare this to a will-only situation: If Robert only had a will, that document would provide no help whatsoever. His family would need to petition probate court for a conservatorship—a time consuming and costly process that requires ongoing court supervision and reporting. This could cost $3,000-5,000 annually in fees alone.
Key takeaways
A will only takes effect after death and usually requires probate. A living trust works during your life, during incapacity, and after death—often avoiding probate entirely.
Not all assets belong in a living trust. Retirement accounts typically pass via beneficiary designations, not trust ownership.
Only a will can appoint guardians for minor children. Even if you have a trust, you need a will for this critical function.
Funding matters. An unfunded living trust is just an expensive piece of paper. You must actively transfer assets into it.
Most people benefit from having both a will and a living trust as part of their estate planning documents.
State law varies significantly. What works in California may not be optimal in Texas or Florida.
Moving forward with your estate plan
Understanding the differences between wills and living trusts puts you in a stronger position to protect your family and your assets. Whether you start with a simple will or build a comprehensive trust-based plan, taking action now is what matters most.
Consider these next steps:
Make an estate planning checklist of your assets, including property, accounts, and personal belongings
Think through who should manage your affairs if you become incapacitated
Decide who you want to receive your assets and when
Consult with an estate planning attorney in your state to discuss whether a living trust makes sense for your situation
This article provides general information and should not be considered investment advice, tax advice, or legal advice. Laws vary by state, and your specific situation may require tailored guidance from qualified professionals.
The $84 trillion wealth transfer expected over the next two decades means more families than ever are thinking about these questions. Don’t put it off. Your future self—and your family—will thank you.