Revocable living trusts are a part of many people’s estate plans these days. The primary reason why people decide to create this kind of trust is to avoid the probate process.
Probate is the court process by which a decedent’s assets are transferred to his or her heirs according to the will that is in place. The drawbacks of probate are that the process can be long and expensive, and it can expose private information to the public.
Assets that are part of a living trust are not subject to probate because the decedent is not the owner of the assets upon his or her death, the trust holds the title.
Another reason a person may wish to use a revocable living trust is to provide specific instructions on how children’s or grandchild’s inheritances should be handled.
For example, the living trust may specify that a child will not receive his or her inheritance until reaching the age of 30. Or it may state that an heir with a drug or alcohol problem will not receive an inheritance.
What else do I need to know about a revocable living trust?
The name says a lot. A revocable living trust is a trust that is set up and takes effect during your lifetime, and it is revocable. That means you retain control of the trust and the assets in the trust until you die or become incapacitated. At that point, the trustee you have named takes control over the trust administration.
At any point, while you are alive and of sound mind, you can choose to change the assets in the trust or cancel the trust altogether. An experienced estate planning lawyer can help you both set up your trust and add a property to your trust.