How to Use a Living Trust as Part of Your Estate Planning
When people think about planning their estates, a will might be the first thing that comes to mind. However, it’s essential to be aware that there are other tools that can be used as part of a comprehensive estate plan. Sometimes known as an “inter vivos” trust, a living trust can offer many benefits and provide more flexibility than a will, such as allowing you to remain in control of your assets during your lifetime and ensure your wishes are carried out when you pass.
A living trust can help you achieve your estate planning goals by:
- Helping to avoid probate — By creating a living trust, assets can be distributed to your beneficiaries much faster. You can also avoid the additional cost that could be incurred by going through the probate process in multiple states if property is located in other jurisdictions.
- Allowing you to prepare for incapacity — If you should become ill or incapacitated and unable to manage your affairs, the successor trustee you choose will have the authority to handle the assets held in the trust.
- Dividing your property — Similar to a will, a living trust allows you to distribute your property to your chosen beneficiaries. The trust can also be used to distribute the assets once a beneficiary reaches a certain age.
- Preserving the privacy of you and your family — Since trusts do not go through the probate process, they do not become part of the public record like a will.
To set up a living trust, a document must be drafted appointing a trustee, naming the beneficiaries and identifying the property that will be distributed. While many people name themselves as the trustee who will manage the living trust, a successor trustee must also be designated to manage the assets upon your passing — or in the event of incapacity.
Once it has been established, assets must be placed into the trust. A trust can be funded with various types of assets, including savings accounts, real estate, life insurance, stocks, bonds, jewelry, personal property, business assets or a combination of different things. Although the living trust becomes the legal owner of the assets once they are transferred, you can amend or revoke the trust at any time.
A living trust is just one estate planning strategy. A skilled trusts and estates attorney can work with you to develop an estate plan that will meet the specific needs of you and your family. The legal team at Bottimore & Associates, P.L.L.C. has been assisting clients throughout Washington with their estate planning matters for two decades. Call 253-272-5653 or contact us online to schedule a consultation at our Tacoma office.