Half of my windows got replaced just three years ago during the ownership of former residents. I realized that there is a large gap btw trim and windows. All new windows has this gap but old ones do not. I am not sure if this is a concern but i am worried about water penetration. Should I fill this large gaps with caulk, or install a new wider trim to close this gap? Thanks a lot.
It is not to big of a gap. I have seen joints in commercial building as big as 1 1/2' It is all how the joint is prepared and the type of caulk used to fill the gap.
A 1/4" gap is completely acceptable for a caulk joint. If the surrounding surfaces are sound, no chipped paint, no rotted wood, you can fill it with caulk. In may cases because of movement between materials you need wo fill the gap with a "backer rod". This will keep the caulk from going too deep in the gap. The ideal thickness for caulk is 1/2 the depth to width ratio.
This way the thinnest part can expand and contract easily as needed.