Wills vs. Trusts in Colorado: Which One Do You Need?

Three adults engaged in a discussion, reviewing documents and using a laptop in a bright office.

Estate planning can feel confusing when you are trying to decide between a will and a trust. Many people know they need something in writing, but they are not sure which document fits their situation. The right choice depends on your property and your family. It also depends on how you want your affairs handled after death. A Colorado estate planning and probate lawyer can help you understand how each option works before you make a decision.

What does a will do?

A will is a legal document that explains what should happen to your property after you die. In Colorado, a will can name the people who should receive your assets. It can also name the person you want to handle your estate.

A will may also be used to name a guardian for minor children. This is one reason many parents choose to create a will even when they do not own much property. Without a will, Colorado law decides who inherits property that doesn’t pass another way. The court may also need to make decisions that you could have addressed in your own plan.

A will is often simpler than a trust. It can be a good fit for people who have a smaller estate or a fairly simple family situation. However, a will does not usually avoid probate.

What does a trust do?

A trust is a legal agreement that holds money or property to someone else’s benefit. Many estate plans use a revocable living trust. This means the person who creates the trust can usually change it during life.

A trust can explain who receives property after death. It can also name a successor trustee to manage the trust when the original trustee can no longer do so. If the trust is properly funded, the assets inside it may pass without going through probate.

Funding the trust is important. A trust document by itself does not move property. Real estate and bank accounts may need to be retitled or transferred into the trust. Other assets may need similar treatment. If that step is missed, the trust may not work the way the person expected.

How is probate different with a will?

Probate is the court process used to handle a person’s estate after death. If someone dies with a will, the will generally must be delivered to the probate court. The court process helps confirm the will and gives authority to the person handling the estate.

Probate is not always a disaster. Some estates move through the process without major problems. Still, probate can take time and may require court filings. It can also make parts of the estate process public.

A trust may help avoid probate for assets that were properly placed in the trust. This is one reason people with real estate or larger estates often ask a Colorado estate planning and probate lawyer whether a trust makes sense.

Which option gives your family more privacy?

A trust often gives families more privacy than a will. Probate filings are part of the court process. That means some information may become public.

A trust is usually handled outside of court. The successor trustee follows the trust instructions and manages the property for the beneficiaries. This can make the process more private. It can also make things easier for family members who are already dealing with a loss.

Privacy is not the only reason to choose a trust. It may also help when a person owns property in more than one state. Without a trust, out-of-state real estate may require another probate case in that state.

Do you still need a will if you have a trust?

Document titled "Last Will And Testament" on a clipboard with a black pen and magnifying glass.

Many people still need a will even if they have a trust. This is often called a pour-over will. It can direct any property left outside the trust into the trust after death.

A pour-over will is a backup plan. It does not replace the need to fund the trust during life. If too much property is left outside the trust, probate may still be needed.

A will may also address personal matters that do not belong in a trust. For example, parents may use a will to name their choice for a guardian.

How do you know which one is right for you?

A will may be enough if your estate is simple and you are not worried about probate. A trust may be better if you own real estate, want more privacy, or want to make things easier for your family.

The right plan depends on your goals. It also depends on what you own and who you want to protect. Some people need only a will. Others need a trust with a will as a backup.

Beyer & Associates, LLC can help you decide what estate planning tools fit your life. If you have questions about wills or trusts in Colorado, a Colorado estate planning and probate lawyer can help you take the next step. Call Beyer & Associates, LLC at (970) 276-8036 or reach out online to learn more.