If you have a large amount of assets, children from different marriages, or own a business, your estate planning attorney may recommend a revocable trust.
Forbes’ recent article, “Revocable Trusts And Why Should You Consider One,” explains that a revocable trust, also called a “living trust” or an inter vivos trust, is created during your lifetime. On the other hand, a “testamentary trust” is created at death through a will.
A revocable trust, like a will, details disposition provisions upon death, successor and co-trustees, and other instructions. Upon the grantor’s passing, the revocable trust functions in a similar manner to a will.
Advantages to a Revocable Trust
- A revocable trust is a flexible vehicle with few restrictions during your lifetime.
- You usually designate yourself as the trustee and maintain control over the trust’s assets.
- You can move assets into or out of the trust, by re-titling them. This movement has no income or estate tax consequences.
- It is not a problem to distribute income or assets from the trust to fund your current lifestyle.
- A living trust has some advantages over having your entire estate flow through probate. The primary advantages of having the majority of your assets avoid probate, is the ease of asset transfer and the lower long term costs to your estate.
- A revocable trust provides privacy. A probated will is a public document that anyone can view.
- Provides for the possibility of future diminished legal capacity, when it may be better for another person, like a spouse or child, to help with your financial affairs. A co-trustee or successor trustee can pay bills and otherwise control the trust’s assets. This can also give you financial protection, by eliminating the need for a court-ordered guardianship.
Do I still need a will? Even with a revocable trust, you still need a will. A “pour over will” controls the decedent’s assets that haven’t been titled to the revocable trust, intentionally or by oversight. These assets may include personal property. This pour-over will generally names the revocable trust—which at death becomes irrevocable—as the beneficiary.
There are many different strategies available to protect your family and your property. At the Weaver Firm – Attorneys, we’re glad to visit with you about ways to ensure your estate plan follows the proper formats and procedures. We can also help you clarify your goals and make sure that your plan puts them into action, after your death or if you are no longer able to make your own decisions.
Give us a call at 817-638-9016 to schedule an appointment. We also offer a free 15-minute phone meeting with Travis Weaver, attorney, as an opportunity for questions and answers. We look forward to helping your family make plans for the future today.