Benefits of a Revocable Living Trust

March 13, 2014
Updated on November 6, 2020

Many people now choose a revocable living trust instead of relying on a stand-alone will, beneficiary designations, or joint ownership in their estate planning. A living trust that has been properly prepared and funded with your assets can provide many benefits for you and your loved ones.

How many of these benefits of a revocable living trust are you familiar with? A living trust:

  • Avoids the time and expense of probating the assets held by your trust when you die
  • Avoids multiple probates if you own real estate assets in more than one state
  • Provides easier, more efficient administration of your estate
  • Prevents court interference at incapacity and after your death
  • Gives you and your family maximum privacy by avoiding public court processes
  • Minimizes emotional stress on your family
  • Brings all of your assets into one plan controlled by one set of instructions
  • Prevents unintentional disinheriting
  • Makes it easier to make equitable (fair) distributions to your beneficiaries
  • Lets you keep assets in the trust until your beneficiaries reach the ages at which you want them to inherit
  • Can continue longer to provide for a loved one with special needs
  • Enables assets to remain in the trust and be protected from beneficiaries’ creditors, spouses, divorce proceedings, irresponsible spending, and future death taxes
  • Prevents the court from controlling the inheritance of minor children
  • More difficult than a will to contest
  • Provides effective prenuptial protection
  • Can be changed or canceled at any time while you are competent and alive
  • Allows for professional asset management if you choose to have a professional trustee
  • Can include tax planning to reduce or eliminate state and federal estate taxes
  • Lets you keep maximum control while you are living (even if incapacitated) and after you pass on
  • Provides peace of mind

It will probably cost more initially to set up a well-drafted living trust than to have just a stand-alone will prepared. One reason is that a living trust usually has more provisions because it deals with issues while you are living as well as after you pass on, while a will only deals with issues after you pass on. When comparing costs, remember that the true cost of a will must include the costs of probate when you pass on, a possible conservatorship if you become incapacitated, and a guardianship if you leave assets to minor children.

After weighing the costs and benefits, it is easy to see why so many people and professionals prefer a living trust.

Living Trust, Incapacity, Trust, Will, Probate, Estate Planning
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