Legal Question in Wills and Trusts in New York

Re: difference between will and trusts

A will directs that a fiduciary take control of your assets and debts upon your death. Generally, a trust creates an estate during your life that is controlled by a fiduciary during your life.

Even if you have a trust, if you have any assets or debts that are controlled by you (as an individual) and not controlled by the trust, then you need a will to dispose of those assets upon your death.

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Re: difference between will and trusts

While a trust may act as a Will, by providing what will happen to the assets in the trust on your death, it might not be sufficient to cover all of your assets. For example, if your car were not titled in the trust name, something would have to be done to cover its disposition. This is usually done by Will. Some assets may not need either a trust or Will to cover the disposition, as they may be registered in such a way that neither is required. For example, life insurance policies and retirement accounts allow a beneficiary to be named, to receive the proceeds when you die. The registration would act like a Will or trust for disposition purposes. I usually recommend that even if all assets are registered in the name of the trust, a back-up Will still be in existance, in case something is missed. The Will can just say that any assets will become part of your trust, upon your death. Besides a car, some people will not place real estate (their home) in a trust, as they may have trouble getting homeowners' insurance for a trust. While trusts, if properly drafted, may accomplish many different things (asset protection, continuity of asset administration in the event of incapacity, elimination of probate and its costs and estate tax savings), there may still be a need for a Will. To be best off, you should consider having 4 documents: A Will, a trust, a Living Will (Health Directive) and a Durable Power of Attorney. If properly used, these documents can cover all contingencies you may encounter during your lifetime. If you need any assistance or more information, please feel free to contact me.