Revocable Living Trusts
July 25, 2023
When it comes to Estate Planning, the availability of so many different tools can be overwhelming and confusing. There are various options to consider, such as whether I should have a Will or a Revocable Trust?
What is a revocable living trust?
A revocable living trust is a legal document that establishes a separate entity, known as a trust, to hold property and names someone (a trustee) who is responsible for managing property for the benefit of others. A revocable trust can be modified or revoked during the grantor’s lifetime but usually becomes irrevocable when the grantor dies.
Who are the parties to the trust?
A trust involves three parties:
- The settlor or grantor is you, the person who creates the trust
- The trustee is the person who agrees to accept the trust assets and manage the trust as the trust document directs. Typically, the grantor is the initial trustee
- The beneficiaries are those who receive the property after you die. The grantor (you) is entitled to use the trust property and income during the grantor’s lifetime
You retain control
As the grantor and the initial trustee of your revocable living trust, you control the assets in the trust during your lifetime. If you become incapacitated or choose to give up your role as the trustee, a successor trustee, who is appointed by you, will manage your assets. The terms of the trust control how the assets are distributed to your beneficiaries by the successor trustee when you die.
Avoid probate and public disclosure
The main benefit of a revocable living trust is probate avoidance. Probate is a court-supervised process to transfer a decedent’s assets to those who are entitled to receive them. Probate can be a lengthy and costly process that may delay the distribution of your property to your beneficiaries.
Is a revocable living trust right for you?
A revocable living trust is a common estate planning tool that offers many benefits. Like any estate planning tool, a revocable living trust should be considered as part of your overall estate plan. To speak with an experienced estate planning attorney, contact Bakke Norman Attorneys at Law for a consultation to discuss your needs and evaluate what estate planning tools will work best for you.