Most people know what a will is and that it’s important to have one. However, what most people in California don’t realize is that for most people who own property, a will is not enough to keep that property out of court when they pass away.
One of the biggest differences between a will and a trust is that if you pass away owning more than approximately $166,000 worth of property in California, that property will still have to go through probate court even if you have a will. However, if that property is held in a trust, it avoids probate and passes directly to your designated beneficiaries. A will is like a set of instructions with no mechanism to actually transfer property. A trust includes instructions and the legal ability to transfer property without court supervision.
Unlike wills, trusts can also make provisions for care if a person becomes incapacitated. If you create a trust and fund it with property, a successor trustee is designated who can use your property to take care of you if you are unable to take care of yourself while still living.
While a will sets out instructions for one-time transfers of property upon a person’s death, trusts can continue to hold property and distribute it over time. For example, if you were to pass away leaving behind minor children, your property can remain in trust and your successor trustee can use the property to provide for the health, support, and education of your children.