There are times when a simple will is not enough. A revocable living trust offers several advantages, like flexibility, privacy, and the ability to tailor it to your specific goals. This type of trust not only allows for the management of your assets during your lifetime but also allows your heirs to avoid the hassles of probate and to distribute your assets quickly.
Here's why you may wish to avoid probate:
Probate can diminish your assets by 2-12% due to various fees.
The process can delay the transfer of assets to your heirs, sometimes taking up to a year.
Probate makes your financial details public.
Probate* is essentially a court-supervised procedure where your assets are transferred from your name to your heirs, as per your will. Unfortunately, even with a will, your estate would still undergo probate. A revocable living trust, however, bypasses these probate hassles, keeping costs, delays, and public exposure at bay.
A living trust allows you to use and manage your assets while you're alive, with decisions made by the trustee(s). In the event of your death, any charitable donations or specific instructions you've set within the trust for asset distribution are executed by the trustee(s), without the need for probate.
Moreover, a trust offers protection in case of physical or mental incapacity. Unlike a will, where the courts step in during such incapacities, a trust allows your co-trustee or the trust document to manage your assets, avoiding court intervention.
If incapacitated and unable to manage your affairs, and if you only have a will, the court will appoint someone to act on your behalf. This court involvement often continues until recovery or death, with the court, not your family, deciding how to use your assets for your care.
Opting for a living trust can bring significant benefits for you and your family:
Avoids probate upon death, even for out-of-state properties.
Keeps assets away from court control in case of incapacity.
Consolidates all assets under one plan.
Ensures maximum privacy.
Allows assets to stay in trust until you choose for them to be inherited.
Can reduce or avoid estate taxes.
Flexible – can be altered or revoked any time.
Harder to challenge, ensuring your wishes are followed.
Prevents court involvement in managing minors’ inheritances.
Suitable for dependents with special needs.
Offers peace of mind knowing your estate is well-managed.
*Probate, briefly put, is the legal process where the court ensures your debts are paid and assets distributed as per your will upon death. Without a valid will, state laws dictate the distribution. Probate can be expensive—legal fees, executor fees, court costs and other fees must be paid before your assets can be fully distributed to heirs. If property is owned in other states, your family could encounter multiple probates, each according to the laws of that state.
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