Types of wills and trusts for estate planning
Common types of wills and trusts include simple wills, pour-over wills, revocable living trusts, irrevocable trusts, testamentary trusts and special needs trusts. A will generally gives instructions for after death, while a trust may hold and manage assets during life, after death or both.
Before comparing the different types of wills and trusts, consider when each document takes effect, what property it may control and who manages it. State law and the document’s terms may affect how it works.
Wills and trusts at a glance
This table shows the general role of each document and the types covered in this guide.
The differences between wills and trusts can also include when each document takes effect, whether probate may apply and how property is managed.
Common types of wills
A last will and testament may identify beneficiaries, name an executor or personal representative and nominate a guardian for minor children.
Simple will
A simple will, sometimes called a basic will, usually has straightforward instructions. It may name who receives certain property and who handles the estate.
This type of will may be used when the plan does not call for a trustee to manage an inheritance over time. Property controlled by the will may go through probate.
Will with a testamentary trust
A will with a testamentary trust includes terms directing that a trust be created after death. A trustee then manages the property according to those terms.
This structure may be used to create a trust for children that manages an inheritance over time instead of distributing it all at once.
Pour-over will
A pour-over will works with an existing living trust. It directs certain property left outside the trust to be transferred to the trust after death.
A pour-over will can act as a backup, but property transferred through it may still go through probate. It doesn’t replace the need to transfer selected property to the living trust during life.
Special will formats that depend on state law
Some states may recognize electronic, handwritten or oral wills when specific rules are met. Other states may not recognize these formats.
The Uniform Law Commission's Electronic Wills Act gives states a model for electronic wills, but each state decides whether to adopt it. State-specific legal review may be useful before relying on any special will format.
Common types of trusts
A trust is a legal arrangement in which a trustee holds or manages property for one or more beneficiaries. The written terms explain what the trustee can do and when property may be distributed.
Revocable living trust
A revocable living trust is created during life. The person who creates it can generally change or end it while legally able to act, subject to the document and state law.
This trust may help manage selected property during life and after death. Property usually needs to be transferred or retitled to the trust before the trustee can manage it. Property properly placed in the trust may pass outside probate.
Irrevocable trust
An irrevocable trust is generally harder to change or end after it is created. The person who creates it may give up control over property placed in it.
This type of trust may be used for long-term family needs, charitable giving, asset transfers or tax planning. Legal and tax review may be useful before property is transferred.
Testamentary trust
A testamentary trust is the trust created by the terms of a person’s will. It begins after death and doesn’t operate during the creator’s life.
Property directed to the trust through the will generally passes through probate first. This differs from a living trust, which is created during life.
Special needs trust
A special needs trust may set aside money or property for a person with a disability. Some trusts may be structured so the assets do not automatically count as the beneficiary’s resources for certain needs-based programs.
Trust assets and payments can still affect Supplemental Security Income (SSI), and Medicaid rules may differ by state. Qualified legal and benefits guidance may be useful when creating or managing this type of trust.
Specialized marital, charitable and tax-planning trusts
Some trusts address narrower family, charitable or tax-planning goals.
QTIP and QDOT arrangements may involve federal estate tax elections and filing requirements. Other specialized trusts may involve different federal or state tax rules, so legal and tax review may be useful.
A legal trust needs to be established before a trust account or policy may be opened in its name.
How wills and trusts may work together
A person may use a living trust for selected property and a pour-over will for property left outside it. A will may also address matters the trust does not, such as nominating a guardian for minor children.
The documents may need to be coordinated because creating a living trust doesn’t automatically transfer property into it.
Wills and trusts by estate planning goal
This table highlights one document or structure to ask about for each goal. It is not a complete list or a recommendation for a specific estate plan.
The documents used may depend on state law, the property involved, family needs and current tax rules.
Frequently asked questions
Is a living will the same as a last will?
No. A living will generally states health care preferences if you can’t make or communicate medical decisions. A last will generally gives instructions about an estate after death.
Can you write a will without a lawyer?
Some people may be able to prepare a simple will without a lawyer, depending on state law and their circumstances. Complex family arrangements, business interests, property in more than one state or trust planning may call for help from a qualified legal professional. A qualified tax professional can discuss possible tax considerations.
Do all assets pass through a will or trust?
No. Some assets may transfer outside both documents through a beneficiary designation or ownership arrangement. Examples may include certain life insurance policies, retirement accounts, payable-on-death accounts and jointly owned property.
Plan terms, spousal rights, ownership structure and state law may affect the result.
Estate planning documents can serve different purposes. A qualified legal professional can explain how state law may apply to your plan, and a qualified tax professional can discuss possible tax considerations. For questions about life insurance options or the process for naming or updating a policy beneficiary, consider talking with a State Farm agent.
This content was developed with the help of AI and reviewed by State Farm editors.
Neither State Farm nor its agents provide tax or legal advice.
Please consult your tax, legal, or investment advisor regarding your specific circumstances.
The information in this article was obtained from various sources not associated with State Farm® (including State Farm Mutual Automobile Insurance Company and its subsidiaries and affiliates). While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. State Farm is not responsible for, and does not endorse or approve, either implicitly or explicitly, the content of any third-party sites that might be hyperlinked from this page. The information is not intended to replace manuals, instructions or information provided by a manufacturer or the advice of a qualified professional, or to affect coverage under any applicable insurance policy. These suggestions are not a complete list of every loss control measure. State Farm makes no guarantees of results from use of this information.
