Revocable Living Trusts
A revocable living trust is a valuable estate planning tool, and should comprise the core of most estate plans. It is called a living trust because you create it while you are still alive, unlike a testamentary trust which is created upon your death. Once you create your revocable living trust, you may transfer your assets into your trust. Typically, you will be the trustee as long as you remain competent to do so. You do not give up any control over the assets you put in this type of trust. The trust allows your assets to quickly and efficiently pass to your beneficiaries when you die without having to go to probate court. However, just in case for some reason you fail to have all your assets in your trust at the time of your death, you should still have a Will to handle the distribution of those assets. Most likely, your will would dictate that any such assets be transferred into your trust upon your death. This is called a "pour-over will" because it "pours" those assets into your trust upon your death. A married couple may use a single revocable living trust to hold both co-owned property and the separate property of either spouse.Some advantages of a Revocable Living Trust are:
- Saves your family money. Your assets do not have to go through probate court before they are distributed to your loved ones, saving thousands in legal fees
- Saves your family time and stress. Your loved ones will not have to wait years for your estate to be administered in probate court
- Provides for management of your assets if you become incapacitated
- Ideal for people who own property in more than one state. As cumbersome as probate court is, if you own property in two states, your family may have to go to probate court in both states unless you have done the proper planning
- Your wishes are more likely to be followed. A disgruntled family member will have a better chance of successfully challenging a will than a living trust.
- Privacy. If your assets are not in a trust and your estate goes through probate, it is public record