When should you consider a living trust?

For many people, a will is all that they need to carry out their estate planning goals. However, for others, it may be better to have a trust as the cornerstone of their estate plans.

Although there are many different types of trusts to choose from, many people choose a living trust. This type of trust is created during your lifetime and is complete revocable, meaning that it can be canceled or amended at any time during your life. Upon your death, your assets that you choose to put in the trust are distributed according to the provisions of the trust. Living trusts may be the right fit for you if one of three things is true about your situation.

You want to avoid probate

In a nutshell, probate is the process where the court examines your will, determines whether it is valid and makes sure that your assets are distributed according to it. Although this sounds like a routine process, probate can be expensive and lengthy in some cases, potentially costing your estate a significant amount of money in estate administration and attorneys' fees by the time your estate is closed.

Living trusts allow you to skip the probate process entirely, allowing your beneficiaries to receive their inheritances much sooner at a fraction of the cost to your estate. Additionally, if you have property located outside the state, titling it in the name of your trust can help you avoid probate in that state.

You want more control over the distribution of your assets

Living trusts are also beneficial, because they give you more say in how and when your property is distributed to your beneficiaries. This is especially useful if you have children who are minors. For example, you can delay giving your children their inheritances until they reach a certain age or accomplish a life event (e.g. getting married). Conversely, if you only had a will, your children would receive their inheritances when they turn 18.

You want privacy

Since probate proceedings are a matter of public record, virtually anyone has the right to view the documents filed during it, including your will. If you would rather keep the details of your estate plan private, a trust can help you accomplish this. Since they do not need to clear probate, a trust can keep the details of your estate out of the public eye.

Speak with an attorney

Although a trust may seem enticing to you, it may or may not be a recommended addition to your estate plan. An experienced estate planning attorney can review your situation and advise you further on whether a trust would be beneficial for you.