When families decide they want to leave assets in trust for their children or other beneficiaries, one of the first decisions is how those trusts should be created.
Trusts can be established at death through a will. These are called testamentary trusts because they are created by the terms of the will and come into existence only after the person dies.
While testamentary trusts can accomplish many of the same distribution goals as a standalone revocable trust, they come with significant disadvantages. For families who want to utilize trusts as part of their estate plan, the better approach is to create standalone revocable trusts during life, rather than relying on testamentary trusts in a will.
Testamentary Trusts Require Probate
The biggest drawback is simple: a testamentary trust cannot exist until the will has been admitted to probate.
Under the Massachusetts Uniform Probate Code, a will has no legal effect for purposes of administration until it is admitted to probate and a Personal Representative is appointed.
That means the estate must first go through the Massachusetts probate court before assets can be transferred into the trust. Probate can take many months and, in more complicated estates, considerably longer. During that time, beneficiaries often have limited access to assets, and the Personal Representative must satisfy statutory notice requirements, address creditor claims, and administer the estate before funding the trust.
By contrast, a properly funded revocable trust can avoid probate altogether. Upon death, the successor trustee can begin administering trust assets immediately, without waiting for court approval.
Probate Is Public
Another important difference is privacy.
When a will is filed with the Massachusetts Probate and Family Court, it becomes part of the court record. Probate pleadings, the will itself, and many other documents filed during the administration are generally available to the public.
A revocable trust, on the other hand, is typically administered privately. The trust agreement usually does not need to be filed with the court, allowing families to keep their dispositive provisions and financial affairs out of the public record.
Administration Can Be Slower
Because testamentary trusts are subject to probate court approval and oversight, administration is much less efficient.
Before assets can be transferred into the trust, the Personal Representative must gather assets, provide required notices and accounting, address creditor claims, and complete the probate administration required under the Massachusetts Uniform Probate Code.
A revocable trust avoids the initial probate delay entirely. Because the trust already exists and holds title to assets or receives them through beneficiary designation, the successor trustee can step in immediately after death to manage investments, pay expenses, and make distributions in accordance with the trust terms.
Additional Cost and Complexity
Probate also increases administrative work.
Court filings, statutory notices, creditor deadlines, and other procedural requirements all create additional time and expense. In Massachusetts, avoiding probate often reduces both the cost and complexity of administering an estate.
A revocable trust still requires administration at death, but that administration is generally more streamlined because it occurs outside the probate process.
Incapacity Planning
One advantage of a revocable trusts exists long before death.
If the person who created the trust later becomes incapacitated, the successor trustee can immediately step in and continue managing trust assets without the need for a conservatorship or other court proceeding in many cases.
A testamentary trust does not provide the same benefit because it does not yet exist. During incapacity, management of assets depends on powers of attorney if available, or a conservatorship proceeding through the court.
The Bottom Line
Both testamentary trusts and revocable trusts can protect beneficiaries, provide professional management of assets, and control how inheritances are distributed. The difference is how they get there.
A testamentary trust cannot begin functioning until the probate process is underway. A standalone revocable trust exists during life, can provide seamless management of assets during incapacity, avoids probate when properly funded, preserves family privacy, and usually results in a faster and more efficient administration after death.
For those reasons, if trusts are recommended as part of an estate plan, it is advisable to create standalone revocable trusts rather than relying on testamentary trusts contained in a will. For many Massachusetts families, a properly drafted and funded revocable trust offers a simpler, more private, and more efficient way to accomplish the same planning goals.