The Difference Between A Trust, A Will, and A Living Will

Estate planning comes with a lot of terminology and it is easy to get confused.

Most people have heard of a will, many know about a trust, and some have come across terms like living trust or living will. On top of that, there’s the broader concept of an estate plan.

Each of these plays a different role in protecting your property, your healthcare choices, and your family.

In this guide, we’ll break down what each one means, how they work in California, and which combination might be right for you.

What Is a Trust?

A trust is a legal entity like a private contract that holds and manages property for the benefit of someone else.

When you create a living trust, you are called the grantor or trustor. You name a trustee to manage the assets inside the trust, and you decide who the beneficiaries are (the people who will receive your property).

The trust outlines exactly what happens to your assets both while you are alive and after you pass away.

There are two main types of trusts:

1. Revocable Trust (Living Trust)

A revocable living trust can be changed, updated, or revoked at any time while you are alive and mentally capable.

This flexibility allows you to:

• Add or remove beneficiaries
  
  
• Move property in and out of the trust
  
  
• Update terms as your life changes
  
  

This is the most common type of trust used in California because it helps your estate avoid probate, maintain privacy, and save time and costs for your family.

Learn more: How a Living Trust Secure Your Legacy in Orange County

2. Irrevocable Trust

An irrevocable trust cannot easily be changed once created. It may offer stronger protection from creditors and potential estate taxes, but you give up some control over the assets placed inside it.

These are often used for advanced tax planning or asset protection strategies not typically for general family estate plans.

Other Types of Trusts

There are also special forms of trusts that serve different purposes:

• Testamentary Trust: Created through your will and only takes effect after you die.
  
  
• Special Needs Trust: Provides for a disabled beneficiary without disqualifying them from government benefits.
  
  
• Charitable Trust: Helps you donate assets to a cause while potentially lowering estate taxes.
  
  

Each serves a unique role, but most California families start with a revocable living trust as the foundation of their estate plan.

What Is a Will?

A will (also known as a “Last Will and Testament”) is a legal document that states:

• Who will receive your property after your death
  
  
• Who will care for your minor children
  
  
• Who will manage your estate during probate
  
  

You can also include instructions for your burial or memorial arrangements.

A will goes into effect only after your death.

The Downside: Probate

The biggest drawback of a will is that it generally requires probate, a court-supervised process that validates your will and oversees asset distribution.

Probate in California can take 8–18 months and can cost families thousands of dollars in court and attorney fees.

For example, the probate cost for a $1 million home can exceed $46,000, even if the mortgage is $800,000 because fees are based on the total home value, not the equity.

While a will is better than no plan at all, most families choose a trust-based estate plan to save time, costs, and privacy.

What Is a Living Will?

A living will sounds similar to a living trust, but it’s actually a completely different type of document.

A living will is a healthcare directive that tells doctors and hospitals what you want to happen if you are terminally ill or medically incapacitated.

It answers questions like:

• Do you want life support continued or stopped?
  
  
• Do you want to donate your organs?
  
  
• Do you want to receive pain relief even if it may shorten your life?
  
  

In California, the living will is often part of a larger document called an Advance Health Care Directive.

This form lets you name someone (a healthcare agent) to make medical decisions for you if you can’t make them yourself.

What Is a Living Trust?

A living trust is one that you create while you are still alive, hence the term “living.”

It holds your assets (such as your home, bank accounts, or investments) and allows them to be managed by your chosen trustee for your benefit during your lifetime.

When you pass away, your successor trustee distributes those assets to your beneficiaries without going through probate.

Key Benefits of a Living Trust

• Avoids probate and its high costs
  
  
• Keeps your affairs private (unlike a public will)
  
  
• Ensures faster distribution of assets
  
  
• Can help avoid conservatorship if you become incapacitated
  
  
• Allows control and flexibility while you are alive
  
  

Because of these benefits, the revocable living trust has become the cornerstone of most California estate plans.

See also: How a Living Trust Secure Your Legacy in Orange County

What Is an Estate Plan?

An estate plan is the complete collection of legal documents that protect your property, healthcare wishes, and family both while you are alive and after your death.

It typically includes:

1. Revocable Living Trust – The main document that controls your assets.
   
   
2. Pour-Over Will – A backup will that ensures any assets not in your trust are transferred into it after your death.
   
   
3. Advance Health Care Directive – Outlines your medical wishes and appoints a healthcare agent.
   
   
4. Durable Power of Attorney – Lets someone you trust handle your finances if you are incapacitated.
   
   
5. Guardianship Designations – Names who will care for your minor children.
   
   
6. Final Arrangements Instructions – Optional document for burial, cremation, or organ donation preferences.
   
   

Together, these documents form a comprehensive estate plan designed to protect your assets, reduce taxes, and avoid court involvement.

Learn more: What Does a Complete Estate Plan Include?

Trust vs Will vs Living Will: Key Differences at a Glance

 

Document	Purpose	When It Takes Effect	Avoids Probate?	Controls Health Decisions?
Will	Directs who gets your property	After death	No	No
Living Will / Advance Directive	States medical wishes	While alive (if incapacitated)	Not applicable	Yes
Living Trust (Revocable)	Holds and transfers assets	While alive and after death	Yes	No
Estate Plan	Full package of documents	Now and later	Yes	Yes (includes health documents)

Which One Do You Need?

Most Californians benefit from having both a trust and a will, along with other essential documents in a complete estate plan.

Here’s why:

• Your trust controls assets you have placed in it.
  
  
• Your will handles anything left outside the trust and appoints guardians for minors.
  
  
• Your living will or healthcare directive protects your medical wishes.
  
  
• Your power of attorney ensures your finances are managed if you cannot act for yourself.
  
  

Together, these give you total coverage legal, financial, and medical.

Why Work with a California Estate Planning Attorney

While there are online DIY templates available, estate planning is not one-size-fits-all. Mistakes in wording or execution can lead to disputes, probate delays, or even invalid documents.

Working with an experienced Orange County estate planning attorney ensures that your documents:

• Meet all California legal standards
  
  
• Reflect your exact wishes
  
  
• Coordinate correctly between trust, will, and powers of attorney
  
  
• Protect your loved ones from unnecessary legal costs
  
  

At Pevney Estate Planning, we create custom estate plans for California families that are clear, complete, and legally sound.

Key Takeaways

✔️ A trust manages your property and helps avoid probate.
✔️ A will directs where your assets go but usually requires probate.
✔️ A living will is a healthcare document, not a financial one.
✔️ A living trust lets you control and transfer assets privately and efficiently.
✔️ A complete estate plan combines all of these into one coordinated system.

Final Thoughts

Estate planning does not have to be complicated but it does need to be complete.

Whether you are starting your first estate plan or updating an old one, understanding the difference between a will, trust, and living will is the first step in protecting your future.

At Pevney Estate Planning, we help California families design estate plans that save money, avoid court, and give peace of mind.

Schedule your free 30-minute Strategy Session today or call (949) 377-2996  with Michael Pevney, your trusted Orange County estate planning attorney.