What do you know about living trusts?
A trust exists when a trustee (or trustees) holds legal title to property or assets for the benefit of another (the beneficiary/beneficiaries). In many cases, the trustee is responsible for the maintenance or upkeep of the assets in the trust. There are several different types of trusts, which can help individuals manage the ultimate disposition of their assets. Such legal devices help people maintain control over their property after they pass.
A revocable living trust, for example, is created while a person is living. This trust is revocable, which means the individual creating the trust (the grantor) has control over the trust. This person could change the contents of the trust or even destroy it. This is known as “revoking” the trust. However, the grantor’s rights only exist during his or her lifetime. When the grantor passes away, the trust is then irrevocable. At this time, the trustee, in accordance with the rules or terms of the trust, distributes the trust’s contents.
Benefits of revocable living trusts
One of the biggest benefits to revocable living trusts is that they help people avoid the probate process, which can be timely and expensive. Moreover, the decedent has little control in such situations. In fact, state law determines the distribution of one’s assets.
Moreover, for those who like to keep information private and would prefer to avoid the public probate process, a living trust is fantastic option. Living trusts are generally are private and kept in confidence.
In addition, if the grantor is the actual trustee of his or her trust, he or she can personally manage assets, providing the he or she is able to do so. In the event that one is not competent, a trust can automatically assign a successor trustee, who can guard or manage the trust.
Another advantage to a living trust is that for those who have property in more than one state, a trust can help consolidate the distribution of assets. On the other hand, in probate process, the allocation of assets might need to take place in each state where the property exists. This is called “ancillary probate.” Fortunately, when property is held in a living trust, such proceedings may be avoided.
These are just a few advantages associated with revocable living trusts. There are other types of trusts and various other estate-planning instruments and techniques. However, what is most important is that a plan is created. This helps control the ultimate destiny of property pursuant to a death.
If you want to maintain control over your assets, you should consider arrangements for your property in an estate plan. A qualified estate-planning attorney can help you do this.