Did you know that a will is not the only choice you have when determining how to pass your estate assets to your beneficiaries?
Today, our attorneys from the Meurer Law Offices in Denver discuss the revocable living trust – what it covers, what makes it an attractive option for estate planning, as well as what benefits it provides now and after your passing.
Right out of the gate, a revocable living trust avoids the often lengthy and public process of probate. If properly prepared, this type of trust ensures a streamlined passing of assets to your intended heirs.
Let’s take a closer look at this trust by answering our clients’ most frequently asked questions.
What Exactly is a Revocable Living Trust?
Established when you’re alive (of course), the revocable living trust is a legal document that allows you to designate someone to manage your property. As long as you’re mentally competent, you can change the trust or dissolve it at any time for any reason.
As the creator of this type of trust, you will choose trustees to manage your assets as you direct. It’s common to name yourself as a trustee, along with your spouse, so that your assets remain within your immediate control. Named beneficiaries are those who will benefit from your property when you die.
It is up to you how much money you put in your trust during the estate planning process, as well as what assets you’d like to include – such as a primary or vacation property.
It becomes irrevocable upon your death, so it’s a document that you may wish to modify over time or if an illness takes a turn for the worse. At the Meurer Law Offices, we can help you maintain your estate planning documents to ensure nothing is missed or incorrectly designated.
Highlights of the revocable living trust:
- Avoids probate (but not estate taxes) and assets pass directly to beneficiaries upon your passing
- Designates who receives the assets after your death
- Controls assets during your (the grantor’s) lifetime
- Flexible and can be dissolved at any time
- Becomes irrevocable upon the death of the grantor
- Plans for mental disability (if you become mentally incapacitated, your trust can be managed by your disability trustee and not a court-supervised guardian or conservator)
- Protects the privacy of the assets and your beneficiaries when you die. The trust agreement remains private in contrast to a will which is public record and anyone can potentially access it.
Who Can I Designate as a Trustee?
As with all types of trusts, any mentally competent adult is allowed to be named a trustee. Usually, you and your spouse or other trusted friends/family members will be the trustees. This gives you full control of your property as long as you are alive. If you become ill or disabled and can’t manage your property, the other named trustees will manage it for you.
Some clients opt to include a financial advisor or attorney as a trustee, especially when there’s a larger estate and a spouse or family member would be overwhelmed attempting to manage it on their own. In other situations, a professional may also be named to ensure that your assets are distributed correctly.
How Does an Irrevocable Living Trust Compare to a Will?
Wills and living trusts both contain your inheritance instructions dealing with what will happen to your assets when you die. There may also be conditions to receive the assets as well as other instructions dealing with minor children and other concerns.
As mentioned above, a living trust is often used for people who seek privacy and want to avoid probate. Wills are usually less complicated and less expensive and work well in many circumstances.
If you don’t have a will or a living trust, your property will usually go to your spouse or your closest heirs. Without a legal document stating your desires, the distribution of your assets may not end up where you wanted. In addition, without a will or a living trust, someone you don’t trust could be assigned to manage the distribution of your property or be the legal guardian of your minor children.
What are the Biggest Benefits of a Living Trust?
A revocable living trust allows you to maintain control of your assets while you’re alive and competent while providing peace of mind that your estate will be protected should you suddenly become incapable of managing it due to a worsening illness or sudden passing.
The living trust can also be customized in a number of ways. You can decide exactly how you want your property distributed, including timing disbursements and amounts. An attorney can also help you with wording and clauses designed to ease the tax burden for your beneficiaries. Properly phrased, it can also be used as a substitute for powers of attorney.
And while it can’t stop a family member or other party from challenging the trust, it does provide more protection than a standard will.
Do I Need an Attorney and How Much Does It Cost?
It is always best to have an attorney prepare your legal documents. Contact the Meurer Law Offices in Denver, and we will be glad to help you set up a trust and other estate planning strategies to protect your lifetime of hard work. As for fees, it really depends on the size and complexity of your estate. We do our best to keep our costs as reasonable as possible.
How Do I Decide if an Irrevocable Living Trust is Right for Me?
We offer a free initial consultation so we can sit down with you and discuss your particular needs. We will explain all of your options and benefits of each one. We will help you decide which one will serve you and your beneficiaries best now and down the road.
The Meurer Law Offices in Denver offer reasonable fees, a welcoming office environment, friendly and knowledgeable attorneys, and a convenient location. So, come in and let’s make sure your estate is fully protected and your wishes honored. We look forward to meeting with you.