What A Trust Does, And What It Does Not
Trusts solve specific problems. They are frequently sold as solving general ones.
A trust is an arrangement in which a trustee holds property for beneficiaries under terms set by whoever established it. It is a genuinely useful instrument for particular purposes and is routinely recommended for purposes it does not serve.
What it does well
A trust controls timing and conditions. Property can pass to beneficiaries at ages you choose, subject to conditions you specify, managed by someone you select. A will cannot do this — it transfers outright.
A properly funded revocable trust also allows assets to pass outside probate, which in New York can be slow. Privacy follows, since a will admitted to probate becomes a public record and a trust generally does not.
It provides for incapacity: a successor trustee can manage assets without a court proceeding.
What it does not do
A revocable trust does not reduce income tax while you live. It does not remove assets from your taxable estate, because you retain control. It does not protect assets from your own creditors.
Irrevocable trusts can achieve some of these things, at the price of genuinely giving up control. That trade is the whole subject, and any presentation of it as costless should be treated with suspicion.
The failure that matters most
The most common problem with trusts is that they are never funded. A trust document that exists while the house, the accounts and the investments remain in personal name accomplishes very little.
Funding means retitling assets, updating beneficiary designations, and reviewing it whenever you acquire something significant.
Beneficiary designations govern anyway
Retirement accounts and life insurance pass by beneficiary designation regardless of what a will or trust says. A designation naming a former spouse overrides a carefully drafted estate plan, and this is among the most common and most damaging errors in practice.
New York specifics
New York has its own estate tax with a threshold that differs from the federal one, and a structure under which estates somewhat above the threshold can face a disproportionate result. Planning in New York therefore has to address both systems.
Estate planning is jurisdiction-specific and personal. Use a New York attorney rather than a template.
This is general information, not financial advice. Nothing here is a recommendation to buy or sell anything; speak to a licensed adviser about your own position.