Living Trust vs. Will: What’s the Difference?

A will and a living trust are both estate planning documents that can help you control where your assets go after death.

The main difference between a last will and testament and a (revocable) living trust is when they take effect and whether they go through the probate process. A last will and testament takes effect upon death and must go through probate, while a living trust takes effect when a person is alive and does not go through probate.

Living trusts and wills have key differences, but they can be used together to take advantage of the benefits of both documents.

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A revocable living trust, often just called a “living trust,” allows you to put your assets in a trust, which is a separate legal entity. You choose a trustee to manage the assets for you and your beneficiaries if you die or become incapacitated.

Though living trusts can be revocable or irrevocable, the term “living trust” usually refers to a revocable living trust. A revocable living trust, as its name indicates, is changeable. An irrevocable living trust generally can’t be undone, and because from a legal perspective, the assets you put into the trust are no longer yours, it can help avoid certain estate taxes.

Living trusts aren’t the same as testamentary trusts, which activate after your death.

Advantages of a living trust

• Effective once signed and funded. Living trusts take effect as soon as assets are retitled in the name of the trust. (Wills, on the other hand, only take effect after you die.)

• Protects in case of incapacity. Unlike a will, a living trust preserves assets if the owner becomes unable to handle their own affairs due to illness or injury.

• Avoids probate. Probate is the court-supervised legal process needed to validate your will. In some states, probate can be costly and time-consuming. However, probate typically does not apply to assets in a trust. This also preserves your privacy, because probate proceedings are public record.

• Less likely to be contested. Living trusts generally take legal precedence over wills, and because they bypass probate, they’re less likely to be contested in court.

» MORE: Contesting a will: Who can do it, how it works

Downsides of a living trust

• More complex and costly process. You can probably write your own will more easily — and at a lower cost — than you can create any type of trust. You’re also more likely to need an estate planning attorney to set up a trust, which can be expensive depending on the complexity of your assets. Transferring assets into the trust can also be time-consuming and complicated.

• Cannot designate guardianship for minor children. You can use a will to name guardians for your children, but trusts typically only concern financial assets.

• Does not provide tax benefits. Because the owner of a revocable living trust change or cancel the trust any time, the law views the assets in the trust as the owner’s property. Because of this, assets in revocable living trusts may be subject to estate tax when the owner dies. (Irrevocable trusts, on the other hand, legally remove the assets from the owner’s estate, thus shrinking the size of the estate and providing potential estate tax savings.) This also means that assets in revocable trust are not "shielded" from current or future creditors in the event of your death.

» What kind of trust works for you? Compare revocable vs. irrevocable trusts

A will outlines where your assets should go when you die. You can use a will to designate who should inherit your property, name guardians for your children and make requests for funeral arrangements and other final wishes. Like a living trust, you can change your will at any time while you’re still alive.

Wills generally don’t include assets with named beneficiaries, such as 401(k) accounts or life insurance policies, or any assets that are held jointly. You’ll name an executor to carry out the instructions in your will after your death, supervise the document through the probate process and distribute your assets.

If you die without a will, which is called “dying intestate,” a probate court may distribute your property according to your state's laws.

Advantages of a will

• Simpler to create. You can write your will yourself, with an online will maker or with the help of an estate planning attorney for what will probably be a lower cost than a living trust. There’s no extra step of transferring assets; you just need to list the property you own and where it should go.

• Can designate guardianship for minor children. You can use a will to name a guardian to care for minor children in the event of your death.

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Disadvantages of a will

• Does not protect in case of incapacity. Because wills only have legal standing after death, they can’t protect your assets if you become unable to handle your own affairs (as a living trust can).

• Usually must go through probate. Wills typically need to be validated in probate court before the estate’s assets can be distributed. Probate can be a long, costly process in some states, and proceedings are part of the public record. People can contest wills if they believe they have a claim to certain assets in the estate.

• Does not provide tax benefits. Like revocable living trusts, wills don’t reduce estate taxes or protect assets from creditors. The federal estate tax ranges from rates of 18% to 40% and generally only applies to assets over $13.61 million in 2024 or $13.99 million in 2025. However, estates as small as $1 million may be subject to state-level estate taxes. 

Trusts can be a great financial estate planning tool, but they deal with specific assets, not everything you own. It’s likely you’ll still need a will if you set up a trust, especially if you have minor children.