Studies show that most people are woefully unprepared when it comes to estate planning, and there are a few different reasons for it. One of them is the simple fact that many individuals reason that they will have time to put an estate plan in place at some point in the future.
Clearly, this is certainly a possibility. However, many family members suffer the consequences when loved ones pass away intestate. There is really no reason to procrastinate, and if you do so, you are shirking one of the core responsibilities of adulthood.
Versatile Estate Planning Tool
A lot of people think that estate planning equates to the creation of a last will. They are under the assumption that trusts are only utilized by extremely wealthy people that have very complex financial concerns.
It is true that there are trusts that are used by high net worth individuals that are exposed to the federal estate tax, but there is another type of trust that is ideal for many folks that are not residing in the financial stratosphere. The device we are referring to is the revocable living trust.
The first thing to notice is the revocable factor. There are those that are unsure about what the future will hold, and they don’t want to lose control of any assets. With this type of trust, if you ever want to do so, you can revoke the trust and take back direct personal possession of the assets.
However, this would rarely be necessary if you establish a living trust, because you would have absolute control of assets that are in the trust while you are alive. You could act as the trustee and the beneficiary, so you would be able to utilize the assets in any way that you see fit.
In the trust declaration, you would name a trustee to take over for you after your passing, and you can also add a disability trustee to assume the role in the event of your incapacity. It can be the same person or entity, but this is not necessary.
We use the term “entity” because you can use someone that you know personally, but there is another option. There are professionals that handle trust administration services, such as trust companies and the trust department of banks. This can be a better choice when certain circumstances exist.
There are some advantages to be gained when you use a revocable living trust instead of a last will. One of them is the facilitation of hassle free asset transfers. A will would be admitted to probate, and inheritances cannot be distributed to the inheritors while this process is underway.
It will take around eight or nine months to a year in most cases, and there are also some considerable expenses that accumulate during probate. Another benefit is the ability to include a spendthrift clause that would provide asset protection for a loved one that may not be very good with money.
The estate administration process is streamlined when the majority of the assets that comprise the estate have been conveyed into the trust. As we have stated, you can account for possible incapacity through the empowerment of a disability trustee, and this is another major positive.
Learn More About Living Trusts
We have provided a bit of basic information about the value of revocable living trusts here, and if your interest has been piqued, we have additional resources you can access. Our firm has prepared a series of special reports, and one of them is devoted to this very useful estate planning tool.
To obtain access to your copy and any other some report that interests you, visit our estate planning content library and follow the simple instructions.
Schedule a Consultation!
If you are ready to go right to the source and schedule a consultation with a licensed estate planning attorney, give us a call at 513-721-1513. There is also a contact form on this website that you can use if you would prefer to send us a message.