What Does A Revocable Living Trust Do?
- Provide Financial Management Of Your Property
may act as trustee at first and later decide you no longer wish to do so. A
trustee or successor trustee you've selected can take over the day-to-day
property management. Expect to pay this person a reasonable fee.
- Provide Property Management If You Can't Manage Your
- If you become too ill or disabled to manage your property,
your trustee or successor trustee will do this for you. With no trust in place,
you may need a guardianship or conservatorship. You avoid the trouble and
expense of setting up such arrangements if you have a living trust. If your
trust is unfunded when you become disabled, you'll need to have given someone a
durable power of attorney to enable that person to transfer your property into
the trust (see Power of Attorney).
- Provide For Minor Children When You Die
- In a
living trust, you can make all the provisions for your spouse and children that
you can in a will, including naming guardians for minor children.
- Avoid Probate
- Property in your revocable living
trust doesn't go through probate after your death. If, however, you die leaving
property that never got transferred to the trust, probate usually will be
required. Also, if you own land in another state, probate may be necessary in
that state to transfer the land to your heirs. But putting that land in the
trust may avoid probate in the other state, too. One advantage of avoiding
probate is confidentiality. A living trust doesn't become part of the public
record, unless a trustee or beneficiary insists on court approval of accounts.
Probate records, on the other hand, are open to the public.
- Shorten Or Eliminate Delays In Distributing Your Property To
- This is another advantage of avoiding probate. The
probate process may delay property distribution. With a trust, your trustee may
be able to distribute property to your beneficiaries sooner. This is because,
unlike probate, a living trust operates without court supervision – unless
someone requests such supervision. Still, even with a living trust, outstanding
taxes or claims that you owe money could delay property