What is a Living Trust?
A living trust is a legal document that individuals (grantors) can use during their lifetime to designate a trustee who would be responsible for managing that individual’s assets after death for the eventual transfer to their beneficiary. It is an estate planning tool that may be used in lieu of, or in addition to a will.
The purpose of having a living trust is that it allows for an easier transfer of assets while bypassing the probate process that can be complicated, drawn-own, and expensive. This type of trust can also be used to reduce any federal or state tax burdens to beneficiaries and maintain the privacy of your estate.
How Does a Living Trust Work?
A living trust is also known as a revocable living trust. Unlike an irrevocable trust, the terms of a revocable living trust can be modified at any time without the consent of beneficiaries. The owner of the trust can remove beneficiaries, add new beneficiaries, and make changes to how assets in his or her trust are managed. Similar to a will, a living trust can also be used to designate a guardian for your minor children if you die before they reach legal age.
You do not lose control of your assets while you are still living. Your assets are placed in a trust for your benefit and are only transferred upon your death by your designated trustee. The designated trustee, who is referred to as a “successor trustee” holds legal possession of the individual’s property and assets that will flow into the trust. The trustee will pay your debts and distribute your assets according to your directions in your living trust. As a trustee, this individual has a fiduciary duty to follow your directions.
Who Needs a Living Trust?
Having a living trust is an important part of estate planning. You do not need to be wealthy to have one, but if you are, it can save you and your beneficiaries the expense of probate and some tax expenses. It allows for a faster distribution of your assets at a time when your family may need them most.
Any adult, including husbands, wives, mothers, fathers, grandparents, professionals, business owners who have loved ones they care about and want to provide for them after their death should include a living trust in their estate planning.
How to Find a Living Trust Attorney Near Me
Creating a revocable living trust can be a more complicated process than creating a will, especially if you have multiple assets and properties. It involves transferring assets to the trust through separate paperwork filings to fund your trust. Therefore, it is always best to consult with a living trust attorney.
We have two locations in Napa and in Fairfield that are ready to serve you with creating a living trust and other estate planning tools.