A Revocable Living Trust (RLT) allows a person to avoid probate by placing all of his/her property in a trust for their loved ones to inherit. Many people want to leave their assets to their loved ones and avoid probate costs and fees. The goal is to leave as much of your assets to your loved ones as possible with little if any of it going to expense and costs.
To create a Trust (RLT) you name a Trustee to be in charge of the property of the trust and manage the trust. You can name yourself as a Trustee. However, you should also name a Successor Trustee. Upon your death, the named Successor Trustee will handle carrying out the wishes you have designed in your Trust. There are specific steps to “fund” the trust and transfer ownership that must be taken once the Trust is created. These steps are important and you want to be sure they are done. I have seen too many people go through the process of creating a Trust but then fail to transfer the assets into the trust. Do not skip this all-important step.
For example, to transfer the deed to a house you own, you might transfer ownership of the property on the deed from you individually to the Trust ie., the Mary Doe Revocable Living Trust dated March 1, 2019. As Trustee of your own living trust, you will not give up control over the property you own and have placed in the Trust while you are alive (hence the term “revocable living trust”).
When you make a Revocable Living Trust (RLT) that means that you can change your Trust throughout your lifetime to be sure that the Trust continues to meet your needs as your life circumstances change. A living Trust (RLT) allows property to effectively and efficiently go to the beneficiaries that you have named without going through the steps and processes of probate court.
The intent is not to overwhelm you in this post but to arm you with valuable knowledge that will move you to seek further information and guidance from a professional on the best ways to protect your assets and manage your wealth to create a plan designed specifically to meet your needs. There is one final document I want to mention when you make a living Trust (RLT) and that is the “Pour-Over” or back up Will. This Will is created as a catch-all to cover any assets that have not been placed in the Trust. I am not telling you about this document so that you can forget the step of funding your Trust properly. This document is being referenced so that when you are considering making a Trust, you are aware of the various components.
A common question asked when considering a Trust is – Do I need a lawyer to create a Trust and will my beneficiaries need a lawyer to carry out the Trust once I am no longer here. The short answer is it all depends. Each circumstance is unique and if you are unsure you should absolutely consult an attorney’s legal advice. Haste makes waste and if your estate planning documents do not serve the purpose you desire and are improperly drafted or found to be ineffective, chances are your beneficiaries will find themselves in court going through the probate process that you set out initially to avoid. Here at E. Brown Legal, we have 5 simple steps to take you through the estate planning process hassle-free.