What is the difference between a living trust and a testamentary trust?

Living Trusts generally bypass probate, whereas Testamentary Trusts do not. Knowing the unique advantages of each type of Trust can also help you make your decision. A Living Trust is a natural choice for those who want to avoid probate. These Trusts protect families from extensive oversight from the court system.

Is a revocable living trust better than a testamentary trust?

While a revocable living trust offers more flexibility and control, it usually provides less asset protection against creditors during the grantor's lifetime as compared to a testamentary trust. This is because the assets in a revocable living trust are still considered to be owned by the grantor.

What is a testamentary trust?

Unlike a Living Trust, a Testamentary Trust only goes into effect in the event of your passing. These Trusts typically outline when assets should be distributed to the children, such as once they become legal adults, graduate from university, or get married. You can also dictate a set distribution schedule for the assets.