If you are alive, chances are you should get a living trust. While a will outlines things to be done after your death, a living trust can protect you, your loved ones and your assets while you’re still alive as well. The trust actually owns your property while you’re alive, and at your death, it is distributed to your beneficiaries.
Are There Different Types?
There are two types of living trusts. First, a revocable trust. This is a common option, as you are able to change it at any time during your life. If you decide to disinherit someone based on an unhappy encounter, you can change the trust. It doesn’t become a binding agreement until after your death.
The second is an irrevocable trust, and it can’t be changed. As soon as it is signed, it is set in stone. There are some rare circumstances in which a judge grants a change in an irrevocable trust, but those are few and far between. It would take a very serious situation for this to happen.
What Are Some Benefits?
When you create a trust, you are basically offering some great benefits to your surviving family members. Some examples include:
- Avoiding Probate – The probate process can get quite costly and time-consuming. When all is said and done, your surviving loved ones may not have anything left from your inheritance because it was all squandered on probate. With a trust, everything is ready to be distributed without having to get permission from a probate judge.
- Avoiding Contention – In most situations when someone tries to contend a trust, they are unsuccessful. It would take a very compelling argument about you being coerced to sign the documents during your time alive for a judge to allow the trust to be altered. In most cases, you can avoid having your wishes contended with a trust.
- Maintaining Privacy – A trust is not a public document, so nobody can just walk into a court and request a copy. The trustee is the only individual who knows exactly what is in the trust. As beneficiaries are given their shares, the trustee can decide how much or how little information to share with them.
Can a Trustee Make Decisions Before Your Death?
If you want to take something out of the trust and sell it, such as a home or other property, you would have to have permission from the trustee because the property is now owned by the trust. In many cases, you can be the trustee, which would simplify the situation. A successor trustee would be named for after you die.
Getting a Trust Created