Follow us
  >  Wills, Trusts and Probate   >  Why Should I Consider A Trust Instead Of A Will In Virginia?

Why Should I Consider A Trust Instead Of A Will In Virginia?

Choosing the right tools to use for estate planning can be quite a challenge, especially when deciding between a trust and a will. At Commonwealth Life & Legacy Counsel in Central Virginia, we often review the benefits and potential drawbacks of each option with our clients to help determine the best fit for their unique situations. This post will explore why you might consider setting up a revocable living trust instead of a will as the foundation of your estate plan.

Operation of a Trust Compared to a Will

A trust is a legal entity that holds assets for the benefit of specific beneficiaries. A living trust is set up to take effect during your lifetime, so you can transfer property into it at any time. The type of trust most people use as the foundation of an estate plan is a revocable living trust. You can make changes to this type of trust easily, and add and remove property as you wish. While property in a trust is usually controlled by the trustee and used by the beneficiary, with a revocable trust, you can serve as the primary trustee and primary beneficiary. That means you use your property the same way as you did before you moved it into the trust. 

The reason to go through the trouble of setting up a trust and transferring ownership of assets into the trust is that when you pass away, your trust property does not become part of an estate subject to probate. The person you name as your backup trustee can manage the trust, pay your final bills, and distribute assets to your alternate beneficiaries. This is a simple and swift process. 

If your property is not in a trust and it is not set up to transfer directly in other ways, then it all becomes part of a legal estate when you pass away. Property in your estate must go through the court-supervised probate process which is long and confusing and usually requires legal assistance to manage. The person you name as your executor will have a detailed list of duties to manage, and loved ones will need to wait up to a year or more before receiving property from your estate. 

Benefits of Choosing a Trust Over a Will

One of the primary advantages of a living trust is that it becomes effective immediately upon creation and continues to operate both during your lifetime and after your death. This ongoing control can be particularly advantageous in two primary ways:

  • For Incapacity Planning: If you become incapacitated, the trustee can manage the trust’s assets, ensuring that your financial needs and those of your dependents are continuously met without court intervention.
  • Avoiding Probate: Unlike a will, a trust does not go through probate. This means that the trust’s assets can be managed and disbursed without the delays and public scrutiny associated with the probate court.

Trusts offer a level of privacy that is not available with wills. Since they do not go through probate, the details of your estate do not become a matter of public record. 

Considerations When Setting Up a Trust

There are various types of trusts, each serving different purposes. Deciding which trust suits your needs depends on several factors, including your financial situation, your goals, and the needs of your beneficiaries. Common types of trusts include:

  • Revocable Trusts: A revocable trust can be altered or revoked as long as you are alive and competent. These are the type of trust most commonly used to distribute property to loved ones in lieu of distribution through a will.
  • Irrevocable Trusts: Once established, these cannot generally be changed, offering asset protection and tax benefits. Among other uses, these types of trusts might be used to hold assets for a loved one with special needs so that they can still continue to receive government benefits such as Medicaid.
  • Testamentary Trusts: If you choose to build your estate plan around a will rather than a revocable living trust, you can include provisions in your will to establish a trust after you pass away to provide for your minor children. However, the trust does not take effect until after your death so it would provide no assistance if you should become incapacitated. 

Selecting your trustee is a critical decision. This person or institution will manage the trust’s assets, comply with legal requirements, and carry out trust terms, so it’s essential to choose someone who is reliable, capable, and, ideally, understands your family dynamics and financial strategies.

Learn More About Whether Trusts Might Be Right for You

Choosing between a trust and a will depends on your circumstances, financial goals, and how you want your assets handled during your life and after your passing. While trusts require more effort and expense to set up than a will, they reduce legal burdens and expenses for loved ones in the future. 

At Commonwealth Life & Legacy Counsel, we understand that each family’s needs are unique. We are here to help you explore all your options and create an estate plan that aligns with your wishes and provides for your loved ones in the best way possible.

For a deeper exploration of how a trust might benefit your estate plan or to discuss any other estate planning needs, call Commonwealth Life & Legacy Counsel in Central Virginia at (434) 589-2958 or in Powhatan at (804) 598-1348. You can also reach out online to set up a free consultation. Let us help you make informed decisions that secure your legacy and give you peace of mind.