I usually talk about estate planning in terms of two different approaches:
Simple: having a simple Will, where you give away all of your property outright
vs.
More involved: having what's known as a pourover Will and a separate living trust. You give your property away in your living trust -- you leave it to a trustee, who holds it for one or more beneficiaries
But there's also a middle way, which involves having only a Will, but incorporating trusts into that Will. This is known as having a Will with a testamentary trust. What's the drawback to this approach, and why isn't it more popular?
Well, when I talk about the advantages of a living trust, I address 5 of them in particular:
1. Probate avoidance
2. Control
3. Creditor protection for beneficiaries
4. Privacy
5. Estate tax minimization
If you create trusts under your Will rather in a separate document, those trusts can't be funded during your life (since your Will has no effect until death). As a result, you will need a probate. Your beneficiaries also don't get privacy, since the trust information is all located in your Will, which is a public document. But the other three advantages still exist.
