A trust is used to distribute property or provide for a loved one after you have passed away. A trust allows you to set out rules like how, what, when and where property will be given to your beneficiaries. There are many different kinds of trusts. Trusts are a useful planning tool to reduce estate tax liability, protect property, and avoid probate. However, trusts are more complex than wills and are not necessary for everyone. Here is a link to an article outlining the pros and cons of living trusts: http://www.elderlawanswers.com/resources/article.asp?id=1110§ion=4

If you have children it is important to have a Will in order to designate who will take care of your children and who will take care of your children’s financial resources should you pass away. You can designate the same person to take on both of these roles, or your can select different people for these roles. A Will also allows you to designate a personal representative to handle and settle your estate and financial resources (personal property, bank accounts, real estate, etc.) after you die.

This personal representative will take your Will to probate court after you die in order implement your Will. This is a fairly simple process which usually costs less than $1000. If it is really important to you to avoid probate court, you can set up a Trust. Trusts can be harder to maintain and usually require you to have some of your property (your house, your bank accounts, your cars, etc.) titled in the name of the trust. Not everyone needs a trust.