Posted on: 8 February 2016
A will plays an important role in estate planning, but wills are far from the only, or best, solution for quickly and conveniently dispersing property after death. A revocable trust, sometimes referred to as a living trust, can supplement or even take the place of a will if done correctly. To help you understand how a revocable trust can play a major part in your estate plan, read on.
What can a revocable trust do? This legal document is set up prior to death, and it can be completely controlled by the trust's owner while still living. The owner can add and remove assets, change trust beneficiaries and trustees, and even do away with the trust altogether, if desired.
What does the trust consist of? Almost anything that can be addressed in a will can also be covered by a revocable trust. Your entire estate may be transferred to a trust, including real estate, automobiles, art and jewelry, stocks and bonds, etc. The trust, just like a will, will name beneficiaries of your assets upon your death.
You will appoint a trusted family member, friend or attorney to administer the trust when you either become incapacitated or die. This trustee fills a similar role as that of an executor of a will, ensuring that the bills of the estate are paid and that the assets are distributed to the beneficiaries according to the trust.
How is a revocable trust better than a will?
Upon the trust owner's death, the trustee can either continue to administer the trust until a specific time, or distribute the assets immediately. For example, a trust may stipulate that a certain asset be awarded when a beneficiary reaches a certain age. Unlike a will, however, the contents of the estate addressed in the trust can pass immediately to the beneficiaries, without the need for probate. Probate can often take months to conclude.
Additionally, a trust is completely private. Not only is the general public prevented from viewing the trust, none of the beneficiaries need know the contents of the trust. This aspect of a revocable trust not only offers more privacy for the estate, but could also help prevent beneficiaries from comparing the relative value of transferred assets.
Revocable trusts are valuable tools for estate planning, as they give owners power and flexibility when dealing with their assets. Contact an estate attorney from a company like Donald B Linsky & Associate PA to learn more about how a revocable trust could become a valued part of your estate plan.Share