(And Why It’s Not a “One or the Other” Situation)
Introduction
Let’s face it, when most Malaysians hear the word “trust”, they think of either a rich Tan Sri or a plot from a Korean or HK drama. And when they hear “will”, they picture a dusty old letter read aloud in a lawyer’s office.
In reality, both wills and trusts are powerful tools for managing and distributing your wealth. But they serve different purposes, and using one without the other could lead to unnecessary delays, stress, or unintended consequences for your loved ones.
In this post, I’ll break down the key differences between a will and a trust, explain when you might need both, and offer examples to help Malaysians like you decide.
1. Let’s Define It First
| Feature | Will | Trust |
|---|---|---|
| 📜 Legal Function | Distributes your estate after death | Manages assets during life and/or after death |
| ⚖ Probate Required? | Yes (it can take 6 months – 2+ years) | No (bypasses probate process) |
| 👥 Who Controls It | Executor named in the will | Trustee appointed in trust |
| 📅 When It Works | Only after your death | Can be activated while alive (living trust) or after death (testamentary trust) |
| 🏦 Asset Types | All personal assets not held in trust | Specific assets placed into the trust |
| 🔓 Public or Private? | Public via probate court | Private and confidential |
🧠 TL;DR:
A will is like your final instruction manual.
A trust is more like a vault that works now, later, or both (without the red tape).
2. Why Wills Are Still Necessary
Wills are simple, cost-effective, and often the first step in estate planning. In Malaysia, a properly drafted will:
✅ Ensures your assets are distributed as per your wishes
✅ Appoints the most suitable guardians for your minor children
✅ Lets you name a reliable executor to handle your estate
✅ Speeds up the distribution process (compared to intestacy)
🔎 Case Study: No Will, No Chill
Mrs Lee passed away without a will. Her estate was frozen for over 2 years while her children scrambled through the probate process and court applications. One of her bank accounts (with RM80k) couldn’t be touched until the estate was resolved.
3. What a Trust Can Do That a Will Can’t
Trusts go beyond just “who gets what.” They offer control, privacy, and protection, especially if you:
🔒 Want to delay inheritance until your kids are mature
🔒 Have a disabled child or financially irresponsible heir
🔒 Own business shares or high-value property
🔒 Want to avoid probate (and save time/costs)
🔒 Need to distribute assets across countries
Types of trusts used in Malaysia include:
- Living Trusts
- Testamentary Trusts
- Hibah Trusts (for Muslims)
- Education Trusts
- Business Succession Trusts
💼 Example: Mr. Ng owns 2 shoplots and a family business. Instead of leaving it all to his 3 kids at once, he creates a trust:
- Each child gets a monthly allowance
- Shoplot rental income is used to fund their education
- The business shares are held until one child proves capable of managing it
4. So… Will or Trust?
Here’s a quick cheat sheet to help decide:
| Your Situation | Will | Trust |
|---|---|---|
| Have minor children | ✅ Appoint guardian | ✅ Delay access to inheritance |
| Want to avoid probate | ❌ Will requires it | ✅ Trust bypasses it |
| Own a business | ✅ Name successor | ✅ Protect shares and continuity |
| Worry about heirs misusing money | ❌ Once inherited, it’s theirs | ✅ Set conditions and timelines |
| Need fast asset access for loved ones | ❌ Wait for probate | ✅ Immediate access via trustee |
| Want privacy | ❌ Probate is public | ✅ Trusts are confidential |
🔔 Best Practice:
Use both! A will covers all assets not placed in a trust, while the trust handles specific, sensitive, or high-value assets with more control.
5. Common Myths Malaysians Believe
| Myth | Reality |
|---|---|
| “I’m too young to need a trust.” | Trusts aren’t just for the elderly. They’re for anyone with assets or dependents. |
| “Trusts are only for the ultra-rich.” | Not true at all. Basic trusts can be set up from as low as RM5,000+ depending on the provider. |
| “My will covers everything.” | Wills can be contested or delayed. Trusts offer more certainty and control. |
| “I have EPF and insurance, so I don’t need this.” | EPF and insurance nominees aren’t legally binding under the law of inheritance for Muslims, and still face complications for non-Muslims. |
6. Muslims in Malaysia: Extra Layers
For Muslims, estate planning must consider Faraid laws, which distribute assets based on Islamic inheritance principles.
- A wasiyyah (Islamic will) only allows distribution of 1/3 of your estate to non-heirs.
- A hibah or hibah trust can be used to gift assets during your lifetime.
- Trusts provide a way to care for special needs children or protect daughters’ inheritance in specific situations.
✅ Always seek a Shariah-compliant estate planner if you’re unsure.
7. Final Thoughts: Don’t Choose, Combine!
Think of estate planning like a bento box, not every tool is perfect for every dish. Wills, trusts, insurance nominations, and business agreements all work together to form a complete, robust plan.
🎯 My recommendation:
Start with a will. Then evaluate if a trust adds the protection, speed, or flexibility your estate needs.
Your loved ones shouldn’t have to battle the system while grieving. And your business shouldn’t stall just because of a missing signature.
So What’s Next?
🧾 Ready to secure your legacy with the right structure?
📅 Book a no-obligation estate planning session with me today.
Let’s make sure your legacy is preserved, your way.
The Mindful Money Path 
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