The Advantages of Revocable Living Trusts

When most people think of directing how their assets will pass at their deaths, they think of the need to execute a Will. However, depending upon the extent and complexity of a person's assets, a Will may not be the most beneficial testamentary document to use. A Revocable Living Trust, created during your lifetime, to which you transfer the bulk of your assets, provides a number of advantages.

Avoidance of Probate

A Revocable Living Trust can avoid probate, which is the court-supervised process for the management and distribution of your estate at death. Probate, in most cases, is a time consuming and costly court procedure consuming as much as 5% of the value of your estate. If a Revocable Living Trust has been established during your lifetime, there are no time delays in administering your assets at death. The successor trustee named under your living trust can immediately step in to manage your assets for the benefit of your family members under the terms of the trust document.

Avoidance of Ancillary Probate Proceedings

In the event you own property outside your state of residency, this property may be subject to ancillary probate proceedings in the state in which the property is located. Again, this can be a time consuming and costly procedure. Transferring this property to your Revocable Living Trust can avoid these ancillary probate proceedings.

Avoidance of Guardianship Proceedings

In the event you should become incapacitated and cannot manage your own financial affairs, if your assets are in a Revocable Living Trust, there will be no need to establish a separate guardianship for your benefit. Your successor trustee can assume control of your assets at that point in time and manage them for your benefit as long as your incapacity lasts. Guardianship can severely strain family relationships and again, they can be a costly process. Thus, the assistance a Revocable Living Trust can provide in avoiding guardianship proceedings is extremely worthwhile.

Avoidance of Public Scrutiny

Probate proceedings are generally open to public scrutiny. Avoiding the probate process by use of a Revocable Living Trust can provide privacy to you and your family members.

The advantages afforded by a Revocable Living Trust, including significant cost savings in the administration of your estate and the promotion of efficient management of family assets both during your lifetime and after your death, make its use highly desirable in a number of estate planning contexts.