Why a Testamentary Trust Could Be a Problem for Your Estate Plan
Not all trusts are created equal. In fact, one type of trust can actually cause more hassle than it solves. If you have this type of trust, it’s time to reconsider your estate plan.
I’m Christopher Small, owner of CMS Law Firm in Washington State. We specialize in estate planning and probate, and I want to explain why testamentary trusts can be problematic.
What Is a Testamentary Trust?
A testamentary trust is a trust that exists inside your will. Essentially, your will says, “When I die, create this trust.”
At first glance, this may sound useful. But here’s the catch:
Because the trust only comes into existence after your death, your property has to go through probate first.
The primary benefit of a trust — avoiding probate — is completely lost.
Probate can be time-consuming, expensive, and public, which is exactly what most people try to avoid with a trust.
Why Testamentary Trusts Are Problematic
There are a few reasons you might want to avoid this type of trust:
It doesn’t avoid probate. The trust only exists after death, so your estate still goes through the court process.
It can be costly. Some attorneys may still create testamentary trusts because probate can generate fees.
It’s outdated. Many estate planning strategies today focus on standalone revocable living trusts, which actually serve their purpose of avoiding probate.
What You Should Do Instead
If you currently have a testamentary trust or your estate plan relies solely on a will, consider:
Creating a standalone revocable living trust. This type of trust exists during your lifetime and avoids probate entirely.
Consulting an experienced estate planning attorney. Don’t make changes on your own — an attorney can guide you safely and ensure your assets are protected.
At CMS Law Firm, we never recommend testamentary trusts because they don’t provide real value to our clients. A well-designed revocable living trust is almost always the better solution.
Final Thoughts
A testamentary trust may sound like a good idea, but in practice, it defeats the purpose of a trust. If you want to protect your assets, avoid probate, and simplify the process for your heirs, a standalone revocable living trust is the way to go.
If you’re in Washington State and need help with your estate plan or probate, visit cmslawfirm.com to schedule a consultation. We’ll help you set up an estate plan that actually works.