Many people wonder why they should consider having a “Living Trust” (sometimes called an “inter vivos trust” or “revocable trust”) if they have a will.
Isn’t just having a Last Will and Testament (“will”) good enough?
Well, not necessarily. It depends.
That is not to say that you don’t need a will—you do. Even if you have a will you still need a Trust to deal with things a will cannot do, like appointing a guardian for your children. It is just that together, a will and a Living Trust are like, well, peanut butter and jelly; a horse and carriage; or Fred Astaire and Ginger Rogers. Everything works and works better when you have both.
Wills Require Probate.
A will, (any will) has to go through “probate” before your heirs will get their inheritance. Probate is the court-supervised legal process for passing your estate (money, property, etc.) to your heirs and beneficiaries.
When it comes to estate planning, we want to avoid probate as much as possible.
Because it is time-consuming and costs a lot of money. So, if all you have is a will, your entire estate is going to have to go through probate. This means that it could take years before your heirs and beneficiaries get their inheritance. And it also means that the money your heirs get, is going to be reduced by the costs (usually thousands of dollars) of probating your estate.
Trusts Do Not Go Through Probate.
Living Trusts, on the other hand, do not have to go through probate. A Living Trust is a private contract between you, as the settlor of the trust (the maker of the trust) and the trust entity (the legal entity that holds the trust property). In most cases, you, as the settlor of the trust will also serve as the trustee of your revocable living trust, managing the trust asset until your incapacity or death. At that time, the trust will be managed by the successor trustee who you have named. The successor trustee will settle the trust and distribute its assets to the beneficiaries named in the trust documents.
No probate. No public records for the whole world to see what you owned and who you gave it to. No extra costs or delay.
If your Living Trust has been prepared properly and thoroughly, you could avoid probate altogether!
Premiere Estate Planning.
At Esser, Bradley and Khalsa, our estate planning attorneys will work with you to create a thorough and proper Living Trust. Call us today for a FREE consultation to discuss your specific needs. Don’t wait! Contact us today to set up your free appointment.