Which is better: A will or a living trust?
Determining which is better, a will or a living trust, depends on what kind of assets you own and how old your children are.
Randy: I just had a question. I have married, I have two teenage children, and we have a will that we made probably when they were very young. Obviously, circumstances have changed, our assets have increased. I just wonder I've been mixed information about whether to move forward with another will or whether trust would be a better option. What factors do you consider when you're deciding between the two?
Attorney Tom Olsen: A trust would be used in two circumstances, Randy. One is, somebody has really accumulated a lot of wealth and multiple pieces of property, and we're using it for the purpose of avoiding probate. The other time that I use it, is when people have children who are under the age of 25 like you. In this trust, you're not only you avoiding probate, but you're going head and setting up a trust for the benefit of your minor children where you get to designate who would be the trustee, who would manage the money if you and your wife both passed away? You get to dictate at what age they would get that money. Randy, definitely because you've got these young children, I think that definitely puts you into a category of a trust.
Randy: Are there any disadvantages to a trust?
Attorney Tom Olsen: Little bit more complicated and more expensive than a traditional will.
Randy: Okay. I heard some things about which you. Would put a house everything in the trust you can put other stuff in the trust and or not I don't--
Attorney Tom Olsen: Randy-
Randy: If I heard sometimes we have rear-
Attorney Tom Olsen: Randy, when you sign a trust it is all you have built an empty vault or an empty safe and you must then fill it up with all of your assets. If you're going to get the full benefit of
your trust for the purpose of avoiding probate, your trust will own all of your assets. It will be the cotangent beneficiary on your iris in life insurance.
Randy: Okay. One last question, if I didn't have a trust. I have minor children. How would that money be distributed? Would they get it as minors or would it go to the executor?
Attorney Tom Olsen: Randy, if we look at your will you might very well have some trust set up within the body of your will. That would be the question that I'd have to look at your will to know the answer to that question. Randy, I do offer a free initial consult to talk about a will or a trust for you. Randy, I would suggest that you and your wife schedule appointment come see me I'd be happy to talk to you about it in more detail.
Randy: It sounds great thank you.
Attorney Tom Olsen: All right, Randy. Bye, bye.