What Is a Living Trust (or Revocable Trust)?
A trust is a legal written agreement where the trustee (usually an individual or company) holds and manages assets on behalf of or for the benefit of the beneficiary (usually a person, group of people or charity).
A Living Trust, also known as a Revocable Trust, is a specific type of trust where the beneficiary can often transfer assets in and out of the trust whenever they want to. The entire trust can be amended or even ended (“revoked”) by the beneficiary. Often the beneficiary of the Living Trust is also the trustee, and frequently the person creating the Living Trust or Revocable Trust is the person putting assets into it.
A Living Trust Gives the Beneficiary Flexibility
Many people want the advantages of a trust in their estate plan, but do not want to give up control of or access to the assets they put into it. A Living Trust allows the beneficiary the flexibility of having full access to the assets, while at the same time getting many of the benefits of having a trust.
Benefits Of Having A Living Trust
Benefits To Having A Living Trust can include:
- Avoiding Probate
- Ease of Transferring Assets to the Next Generation
- Access to Assets in Case of Incapacity
- Avoiding Costly Court Proceedings For Minor Beneficiaries
- Protecting and Preserving Assets for Children
- Asset Protection for Successor Beneficiaries
Part of a Comprehensive Estate Plan
As part of a comprehensive estate plan, a Living Trust can allow you to plan and provide for yourself and your loved ones during your lifetime and in the event of your incapacity, and to have a carefully thought-out plan that takes effect immediately upon your death. It can give you and your family peace of mind that things will be taken care of during a very difficult time.