What is a Trust and Do You Need One?
The creation of a revocable living trust to house your assets can be a smart choice for several reasons: privacy, convenience, and greater peace of mind. Read on to find out how you may benefit from establishing a living trust.
A revocable living trust is one that can be revoked or altered during your lifetime, as opposed to an irrevocable trust, which cannot be changed or terminated without the permission of your beneficiary. Below are just some of the reasons you may consider having a trust drafted.
Trusts protect your privacy. While a will and its contents will eventually be made public during the probate process in court, a living trust will never be subject to any public scrutiny. Only the specified trustee, beneficiary, the IRS or other parties involved in the trust will be able to view those documents.
Trusts are not subject to probate court proceedings, and are more difficult to contest than a will. All benefits outlined in a living trust will pass directly to the beneficiaries. Administering a will requires going through probate court proceedings before they become valid.
Trusts eliminate the need for guardianship proceedings. If a person with a living trust becomes incapacitated, their designated trustee automatically takes control of the estate without the need for guardianship proceedings, which can be costly and time-consuming.
Trusts remove the requirement for separate probate proceedings for real property. If a person owns property in more than one state, putting it into a trust eliminates the need for separate probate proceedings in each state where property is owned, providing that property is properly titled into the trust prior to death.
Trusts are under your control during your lifetime. As opposed to a will, which takes effect only when you die, the assets in a living person’s trust are fully under their control.
Trusts ensure your assets are distributed the way you want them to be. If you want your assets to pass to a specific person and do not want to risk someone else having access, a trust prevents anyone other than the beneficiary from inheriting those assets.
Trusts allow you to plan for the possibility of becoming incapacitated. If there is a risk you may become incapacitated before you die, a trust allows you to designate the person or people who will manage your estate and affairs.
Beware of scammers. According to the National Consumer Law Center, some salespeople take advantage of fears that a person’s property will be taken by the government or other entities after their death. These dishonest salespeople use this fear to trick seniors and others into purchasing ineffective and legally unsound living trusts.
Companies may sell self-help living trust kits, which are not tailored to individual needs and often fail to accurately inform the consumer of the requirements to establish a valid trust; they may send door-to-door salespeople representing a company name that sounds like a valid non-profit organization, like the AARP (American Association of Retired Persons), though the AARP does not sell or endorse living trusts; or they may claim their salespeople are attorneys when they aren’t, in addition to other false and misleading claims.
To learn more about avoiding living trust scams, contact the National Consumer Law Center at (617) 542-8010 or visit their website at http://www.nclc.org.
Hiring a licensed, experienced attorney to assist you in creating a living trust is the best option to avoid scams and ensure your assets are protected. Katherine Kim Law PLLC has experience in creating living trusts and estate planning. As an attorney who serves real people with real problems, Katherine Kim is able to give you affordable and complete legal guidance on the best way to set up your living trust. Call (214) 814-5123 for a consultation.