Estate plans in New York and around the country usually include a last will and testament and, in some cases, at least one trust. The majority of the estate will usually be distributed according to the provisions of one of these documents, and they both have advantages and disadvantages. Trusts are often used for this purpose because the assets placed into them are not subject to probate, which saves both time and money. Avoiding probate also allows estates to be administered more discretely as trust documents are not filed with the court and are thus not available to the public.
However, there are disadvantages to using trusts to distribute an estate’s assets. Drafting a trust is more complex than writing a will, which means that the initial costs will be higher. Assets placed into trusts must also be titled in the name of the trust. This adds more paperwork and another layer of complexity for assets with deeds or titles like real estate and motor vehicles. When legal title is not transferred, the trust serves no real purpose.
Wills are more straightforward and any assets owned by the testator at the time of death will automatically be included in the estate. Wills are also easier to revise and update. However, this simplicity comes at a cost. Wills must go through probate and they are more likely than trusts to be challenged.
Attorneys with estate planning experience may suggest incorporating a pour-over will. Instead of a list of individual bequests, a pour-over will states that all assets owned by a testator are placed into a trust upon death. While a pour-over will is subject to probate, the process should be completed fairly quickly and the document is unlikely to be challenged. This approach offers the simplicity of a will and the added control provided by trusts.