MSU Extension: Testamentary Trusts Have Advantages

A testamentary trust is one that is set up according to the instructions contained in a last will and testament. The owner’s property, such as stocks, bonds, mutual funds, home, bank or credit union accounts, and certificates of deposits, must first pass-through probate or bypass probate by naming the testamentary trust as the beneficiary. A will is an instrument that sets up the testamentary trust, however, so the will must go through the probate process.

According to Marsha Goetting, MSU Extension family economics specialist, the personal representative appointed by the district court transf...