Living Trust vs Will in Massachusetts: What’s the Difference?

For any individual, no matter your age or wealth status, having a comprehensive estate plan in place is crucial to the protection of your hard-earned assets and the future financial stability of your loved ones. There can be many complications, however, to establishing an estate plan, and individuals may wonder at the difference between a living trust vs a will in Massachusetts. There are things a trust does that a will does not, and understanding those distinctions is key. At Albanese Law, LLC, our team can help determine which document is right for you.

Defining a Will in Massachusetts

A will, otherwise known as a last will and testament, is a piece of legal documentation that outlines your final wishes. It can include instructions on the care and guardianship of your minor children or any adult children who are incapacitated due to a mental or physical disability. It can also dictate how your estate will be divided among your heirs following your death. For a will to be considered valid, it must meet certain requirements, such as:

• The individual who creates the will must be of sound mind
• The individual who creates the will must be at least 18 years of age

A will allows you several legal actions, including the appointment of an executor, the individual who will handle all of your estate’s affairs after your passing, and the ability to name guardians to care for your children or other dependents.

You can also designate how your assets will be managed and distributed upon your death and lay out your wishes and specifications regarding funeral and burial arrangements.

There are several advantages to creating a will. The establishment of a will is much simpler than other documents typically involved in estate planning. You can write up the will yourself or with the help of an attorney for what may be a lower cost than creating a living trust. Additionally, you do not need to transfer assets; you simply need to list your property and where or to whom you want it to go.

The stark reality is that over half of Americans over the age of 18 years old do not have a will in place, and only 18% of adults 55 years and older have an estate plan at all. When you die without a will in Massachusetts, the state courts will decide what happens with your assets and property. Assets from your estate could be distributed to someone you had no intention of naming as a beneficiary.

Defining a Living Trust in Massachusetts

A living trust is a legal, financial agreement that allows you to transfer certain assets and properties into a trust, an entity separate from you. When you establish a trust, you must appoint an individual to act as your trustee. This individual will manage the assets and property holdings held within the trust and carry out all the instructions you have laid out in the trust document.

A living trust is created and established during your lifetime, and you must adequately fund it with assets or property so that it will remain effective. A trust can allow you to set your own terms when it comes to the management of your assets and give you more power and control over how your trustee manages the assets and how they will be distributed. Trusts can come in various forms to fit your unique needs and life circumstances.

Establishing a living trust can help your loved ones avoid the costly and time-consuming probate process. It can also help preserve your assets should you become incapacitated and unable to manage your financial affairs.

The Main Differences Between Living Trusts and Wills in Massachusetts

There are several key differences between a living trust and a will in Massachusetts. These differences include:

• The date the document takes effect. In Massachusetts, a will only comes into effect after your passing, whereas a living trust can take effect as soon as it has been officially set up and funded.
• Costs and efforts involved. The costs involved in establishing a trust can be much higher, and the overall process can take much longer than the costs and efforts involved in creating a legal will.
• Contestability. Because of their nature, it is more difficult for individuals to contest the guidelines or items laid out in a trust, whereas a will has a higher chance of facing disputes between family members or other beneficiaries during the probate process.

FAQs

Does a Will Offer Tax Benefits?

A will does not offer tax benefits, unlike an irrevocable living trust, a trust that cannot be changed, modified, or revoked. An irrevocable living trust offers several tax benefits and can mitigate the taxes owed by your estate. If you are looking for ways to save on taxes in your estate plan, an estate planning attorney can give you advice.

What Are the Disadvantages of a Living Trust in Massachusetts?

It is important to keep in mind that a living trust can also have its downsides. The disadvantages of a living trust can include the complex and costly process of establishing a trust, the lack of ability to name a guardian for a minor or incapacitated child or dependent, and the lack of tax benefits for a revocable living trust.

Why Is It Important to Have a Valid Will?

It is important to have a valid will for several reasons. In the United States, over 2.9 million children lose at least one of their parents or guardians to death every year. This is a staggering number. When these individuals leave behind valid and legal wills, they can lay out provisions regarding the guardianship of their children left without care. However, when no will is in place, the state will be in charge of making these crucial decisions.

What Are the Downsides of a Will?

There can be several downsides to creating a will, which is why you should always speak with an attorney before establishing one. A will typically must go through probate court, which can be a long and costly process. A will also does not allow your loved ones any tax benefits.

Speak With an Experienced Massachusetts Estate Planning Lawyer Today

If you are trying to determine whether a will or living trust is right for you, contact the estate planning attorneys at Albanese Law, LLC. With our years of dedication and experience helping individuals in and around the Boston area, we are here to assist your family in the creation of whichever estate planning documents fit your needs. Contact us today to learn more.