5 Advantages A Living Trust Brings Every Family
Do you love your children? Do you want the absolute best for them, their children, and your future descendants? Of course you do! We all do!
What happens to your family, your assets, and your wishes after you’re gone? If you do nothing, your assets are slashed by court fees and creditors. Your family fights over who gets what. Your minor children and pets end up by either whoever claims them in your family or they become custodians of the state.
When you do something about it and set up your estate plan and living trust, you’re most protected. Your wishes are followed by and for your family and your assets are distributed exactly as you want.
Like most Americans, we do NOT like the idea of the government choosing what happens to our personal lives. Especially not with our family or our property. Can you imagine letting the state raise your children? Let’s not even imagine what the state would do to your pets.
What happens when you do set up your living trust? What exactly is a living trust? What are the advantages they bring?
Continue reading to find out!
What’s a Living Trust?
The living trust is a highly popular estate planning tool. Why? Because it’s effective. Surprisingly, only 25% of Americans (including those of us in Cleveland, Ohio) are protected with living trusts as part of their estate planning. Thankfully, it is easy to get your living trust set up. Hire the right estate planning lawyer, tell him what you need, and let him take care of all of the details.
A living trust (also called a revocable living trust) is a legal entity designed to privately hold your assets during your lifetime. Being revocable means that at any point in your life, you may modify or terminate any or all parts of your living trust.
Among the myriad of legal, technical benefits, the living trust entity provides five tremendous advantages.
The Tremendous Advantages of a Living Trust:
1. Avoid Probate, Save Money
Generally, the cost of probating an estate far exceeds the cost to set it up with a proper estate plan. What’s worse, a probated estate means setting your loved ones up for a long, intense struggle with the court, and possibly among themselves.
Probate is a court-supervised procedure of dispersing a departed individual's estate. Depending upon the assets, in addition to the properties and people included, probate often ends as a prolonged and expensive process. Frequently, probate results in delayed asset distributions. By the time inheritances are distributed according to your state’s law, the diminished amount will shock your family. The court will take its fees, will make payments to unsecured creditors, and will distribute the assets in a way that triggers highly taxable events.
Thankfully, you can easily prevent probate! All that’s required is setting up your estate plan with a living trust. The result? Who you choose to manage the process (your appointed trustee) will disperse the assets following your specific instructions. Your estate not only bypasses the probate process, it is promptly transferred to the hands of a trusted loved one or friend as an executor. Someone who will fight to protect your assets from excess taxable liabilities or unjust creditors.
When you have your living trust, you set up your family for maximum success. You ensure distribution to your beneficiaries happens quickly and without unnecessary cost or risk. You also pay far less now than you would later if your estate were probated.
If you have any property in another state, a living trust saves your family tremendously. The property simply transfers to who you designate. Otherwise, your family would have to travel to that state and be subject to the whims of that court, as well as the dictates of your local court.
2. Designate Inheritors
A well-planned living trust lays out the strategy of your choosing when it comes to all of your property and assets. You set up your family to receive their inheritance in the exact way you see best.
Your living trust also gives you the opportunity to instruct exactly what happens to your minor children and pets. Without the instructions of a living trust, both your minor children and pets become subject to a court’s decision. A stranger acts as a judge to interpret your state law with transferring custody of your loved ones.
Do you really want to risk anyone besides you making decisions for your minor children, pets, and assets?
3. Liability Protection, Stop Creditors
A living trust is a legal entity, which gives liability protection similar to that of a nonprofit and for-profit legal entities. This liability protection blocks potential lawsuits against your estate, which is especially helpful if you are in a profession that requires malpractice insurance, where a person can sue for malpractice years after the event.
The liability protection also blocks potential creditors who salivate at the prospect of pouncing on the vulnerable estate. With the legal protection of your living trust, your designated trustee decides what creditor gets what, if anything. Otherwise, a court has no incentive to protect the estate. The court will not think twice in diminishing the estate upon the descendant of the predatory creditor onslaught.
Often at the end of one’s life, medical care becomes necessary. Unfortunately, we live in a society where medical care comes far from cheap. The devastation becomes very real when unjust medical debt collectors swoop in to pick an estate dry.
Living trusts also protect against in-fighting among inheritors. While not pleasant to consider, the reality is that when money is involved, things can get ugly. Why not prevent any possibility of any in-fighting? With a living trust, you ensure objections to your wishes of distribution don’t happen.
4. Privacy Protection
Among the primary advantages of a trust is the avoidance of the probate procedure, which is public record.
A living trust is a private legal document between the participants. It does not become part of the general public record. In short, you ensure your estate remains private. You prevent anyone from snooping into the details of your estate, which can be discovered with a simple web search.
Not having any estate plan, every detail of your estate becomes complete public record. Surprisingly, even if you have a will (or a last will and testament), your entire estate becomes public record, too.
The only way to ensure your private affairs stay private is with the use of the living trust, or other forms of legal trust entities.
5. Emergency Protection, In Case Of Incompetency
Heaven forbid something happens to render you incompetent, disabled, or otherwise unable to make important decisions. If anything tragic were to happen, the person you designate as your beneficiary trustee intervenes to handle your obligations. Otherwise, there would be mountains of red tape to get the same access by going through the bureaucratic procedures of a court.
Hence, you prevent a court-appointed conservatorship for your estate with a living trust.
Now that you better understand what advantages come to you when you have your living trust as part of your estate plan. Are you ready to learn more?
Why not schedule your free consultation right now? Why not get more information to better understand your situation?
Attorney Nick Costaras, an estate planning lawyer, loves protecting families just like yours. With over 8 years of experience. he will draft for you the exact estate plan you need. You will have all of the necessary documents to give you the maximum protection under United States law. You will have the perfect last will and testament, living trust, power of attorney, health care directive, and more for you and your family’s exact needs.
You worked hard for your family. You deserve to have the peace of mind that comes with knowing you have done what it takes to set them up for success after you’re gone. Once your estate plan is set, you can rest easily knowing that you have successfully protected your family from the very real legal and financial dangers of dying intestate.
Schedule your free consultation now! We look forward to hearing from you.
7 Benefits Of Estate Planning: Wills & Power of Attorney - learn more about why estate planning helps you and your family.
Free Estate Planning Resources - enjoy these free resources to help you better understand the Estate Planning process.