A living trust, also known as a revocable trust, is a legal tool that helps you decide how your property and assets will be handled during your lifetime and passed on after your death. While it can be more complex to establish one, many still opt to include it in their overall estate plan.
Here are the top benefits of a living trust.
Trusts offer privacy and speed in distributing assets
Wills go through probate court and become public record. Establishing a revocable trust, however, keeps your assets private as you won’t have to go through probate to execute it. You will only need to meet with your attorney and your trustee to discuss details.
And since your trust will not go through probate court, the distribution of your assets becomes faster. This is important if you have loved ones who may need support early, such as dependents with disabilities who can benefit from ongoing care funded by the trust.
You can be flexible with your trust’s conditions
When setting up your trust, you can set specific rules for managing and distributing your assets. This helps protect your wishes, especially if you worry about conflicts, such as unintentionally disinheriting a loved one.
For example, you can set a specific amount your beneficiaries will get monthly or yearly if you feel like they need help managing their funds. You can also set age and usage limits, such as only releasing funds once your beneficiary turns 18 and only to cover their college education.
Trusts can also help during incapacity or disability
While legal wills are only enforceable after their testator passes away, you can benefit from the trust the moment you make your first contribution. Your trust can be a safety net for you and your beneficiaries in case you fall ill or develop a disability.
An appointed trustee or executor can also distribute your assets, pay bills or file tax returns on your behalf through the trust. This gives your loved ones peace of mind and helps alleviate some of the decision-making stress, especially with financial matters.
What’s next?
Trusts take time and require some legwork to set up, but they can provide valuable privacy, flexibility and control over how your assets are managed and distributed. Working with an experienced estate planning attorney can help establish your trust properly according to your goals. Taking the time to plan now can provide lasting peace of mind for both you and your loved ones.