By Steven Muller
A living trust is a legal entity that can own property and direct distribution of that property after a person's death. One of the benefits of a living trust is that it isn't subject to probate, or its associated costs and delays.
If you establish a trust, you appoint yourself as the initial trustee and primary beneficiary of the trust. You retain full and complete control over the property during your lifetime. In the living trust document, you appoint the individual or charities that will take on the role as successor trustee when you can no longer act as the initial trustee. After death all your assets are given to your beneficiaries without the hassle of probate. Probate is the process of properly transferring the estate to the rightful beneficiaries. This process is also used to collect any taxes due on the transfer of the property.
The property from the estate can be also transferred to the intended beneficiaries via a will. A living trust is sometimes referred to as a "will substitute." Although, in some respects, it does take the place of a will, a will is still usually necessary to distribute assets outside the trust, and to nominate guardians for minor children. The major difference between a will and a living trust is a will does not avoid probate and does not protect the management of your assets in the event of you should become debilitated during your lifetime.
Sources:
http://www.legalzoom.com/legal-articles/will-vs-living-trust.html
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