📈 Finance

Estate Planning: How to Write a Will and Set Up a Trust

Walter Hennery·July 28, 2026·10 min read

Nearly 70% of American adults don't have a will. If you die without one, the state decides who gets your assets, who raises your children, and how your debts are paid " — and the results often aren't what you'd want. Estate planning isn't just for the wealthy. Whether you own a home, have children, or simply want to make things easier for your loved ones, having a basic estate plan is one of the most important things you can do for your family.

Why You Need an Estate Plan

Without an estate plan, your family faces several problems after your death:

Probate court: Your assets go through a lengthy, expensive legal process that can take 6-18 months and cost 3-7% of your estate's value.
State decides distribution: If you have no will, state intestacy laws determine who inherits " — which may not align with your wishes.
Court-appointed guardians: If you have minor children and no designated guardian, a judge decides who raises them.
Family disputes: Ambiguity leads to fights. A clear estate plan prevents family conflict.
Tax inefficiency: Without proper planning, your estate may pay more taxes than necessary.

Estate Planning Documents You Need

Document	Purpose	Cost (DIY)	Cost (Attorney)
Last Will and Testament	Directs asset distribution and names guardians	$30-$150	$300-$1,000
Revocable Living Trust	Avoids probate, maintains privacy, controls distribution	$100-$400	$1,000-$3,000
Durable Power of Attorney	Designates someone to handle finances if you're incapacitated	$0-$50	$100-$300
Healthcare Power of Attorney	Designates someone to make medical decisions	$0-$50	$100-$300
Living Will / Advance Directive	Specifies end-of-life care preferences	$0-$50	$100-$300
Beneficiary Designations	Names who gets retirement accounts, life insurance	Free (through provider)	Free (through provider)

How to Write a Will: Step-by-Step

Writing a will doesn't have to be complicated or expensive. Here's how to do it:

Step 1: Take Inventory of Your Assets

List everything you own: bank accounts, retirement accounts, real estate, vehicles, investments, valuable personal property, and digital assets (crypto, online businesses, social media accounts). Don't forget life insurance policies and any outstanding debts.

Step 2: Choose Your Beneficiaries

Decide who gets what. Be specific " — "my daughter Sarah" is better than "my children" (which can cause confusion if family dynamics change). Consider contingent beneficiaries in case your primary beneficiary predeceases you.

Step 3: Name a Guardian for Minor Children

This is the most important part of a will for parents. Choose someone you trust to raise your children. Name an alternate in case your first choice is unable or unwilling. Discuss your decision with the person you're naming.

Step 4: Name an Executor

The executor is responsible for carrying out your will's instructions. Choose someone organized, trustworthy, and willing to serve. A family member, close friend, or professional fiduciary can serve as executor.

Step 5: Write and Sign the Will

Most states require your will to be signed in the presence of two witnesses who aren't beneficiaries. Some states also require notarization. Online services like LegalZoom, Trust & Will, and Nolo offer state-specific templates that guide you through the process.

DIY vs. Attorney: If your estate is simple (under $500K, no complicated family situations, no business ownership), a DIY will using an online service is perfectly adequate. If you have significant assets, a blended family, a business, or complex wishes, hire an estate planning attorney.

Understanding Living Trusts

A revocable living trust is a legal entity that holds your assets during your lifetime and distributes them after your death " — without going through probate court.

How a Trust Works

You create the trust and transfer ownership of your assets into it (this is called "funding" the trust).
You serve as the trustee (manager) during your lifetime, maintaining full control.
You name a successor trustee who manages the trust if you become incapacitated or after your death.
After your death, the successor trustee distributes assets to your beneficiaries according to the trust's instructions " — without court involvement.

Trust vs. Will: Key Differences

Feature	Will	Revocable Living Trust
Probate Required	Yes	No
Privacy	Public record	Private
Incapacity Planning	No	Yes (successor trustee takes over)
Cost	Lower	Higher upfront, saves money long-term
Complexity	Simple	More complex to set up and fund
Best For	Simple estates, naming guardians	Real estate in multiple states, privacy concerns, larger estates

Power of Attorney: Don't Overlook This

A power of attorney (POA) gives someone legal authority to act on your behalf if you're alive but unable to make decisions yourself. There are two types:

Durable Financial POA: Allows someone to manage your bank accounts, pay bills, file taxes, and handle financial matters if you're hospitalized or incapacitated.
Healthcare POA: Allows someone to make medical decisions on your behalf if you can't communicate. This works alongside a living will (advance directive).

Without a POA, your family may need to go to court to get a conservatorship or guardianship to manage your affairs " — a process that costs thousands of dollars and takes weeks or months.

⚠️ Common mistake: Many people create a will and think they're done. But a will alone doesn't cover everything. You also need beneficiary designations on retirement accounts and life insurance (these override your will), a power of attorney for financial and medical decisions, and possibly a trust if you own real estate or have a complex estate. An incomplete estate plan can be just as problematic as no plan at all.

Estate Planning by Life Stage

Life Stage	Priority Documents	Key Considerations
Single, No Children	Will, Financial POA, Healthcare POA	Who handles your affairs if incapacitated?
Married, No Children	Will, POAs, Beneficiary designations	Spouse may not automatically inherit everything in all states
Parents of Minor Children	Will (with guardian), Trust, POAs	Guardian designation is critical
Homeowners	Will, Trust, POAs, Transfer on Death deed	Trust avoids probate on real estate
Retirees / Seniors	Full estate plan, Medicaid planning	Tax efficiency, healthcare costs, legacy planning

Cost Breakdown: DIY vs. Attorney

The cost of estate planning varies widely depending on complexity:

DIY with online service: $100-$400 for a basic will package (will + POAs + living will)
Online service with trust: $300-$600 for a complete trust package
Local attorney, simple will: $300-$1,000
Local attorney, trust package: $1,000-$3,000
Complex estate with tax planning: $3,000-$10,000+

The bottom line: At minimum, every adult should have a will, a financial power of attorney, and a healthcare power of attorney. If you own a home, have significant assets, or want to avoid probate, add a revocable living trust. You can do this affordably with online services like LegalZoom or Trust & Will, or hire an attorney for more complex situations. The cost of estate planning is tiny compared to the cost of dying without a plan " — both financially and emotionally for your family.