A last will and testament is by far the most popular estate planning document. However, most people require more than a simple will to meet their estate planning needs. In addition to a will, a revocable living trust is an estate planning document that offers many benefits. In this article, we discuss the importance of including a revocable living trust in your estate plan.
A trust is an estate planning document that allows property to be held by one party for the benefit of another party. The person who creates a trust is called the settlor or grantor of the trust. A trustee, who is appointed by the settlor, manages the assets inside the trust. Trusts can be divided into two categories: testamentary trusts and living trusts. A testamentary trust only activates after the death of the settlor. A living trust, on the other hand, activates while the settlor is still alive. A living trust may be revocable or irrevocable.
Benefits of a Revocable Living Trust
Benefits of revocable living trusts include:
Avoiding probate: Probate is a court-administered process used to identify and value a decedent’s assets and provide creditors of a decedent’s estate with an opportunity to file claims against the estate. Unfortunately, the probate process is expensive and time consuming – especially if the heirs are in disagreement about how the estate should be handled. A revocable living trust, unlike a will, does not have to go through probate.
Privacy: In Kentucky, a will must be filed with the probate court and ultimately lodged in the public records of the County Clerk. This means that anyone with a curiosity can go to the public records, review your will, and see what property you listed in that document and to whom you left it. A revocable living trust is not filed in the public record and typically requires no court involvement unless a major dispute arises. The fact that your trustee can simply execute your wishes as set forth in your revocable living trust means that prying eyes are kept away from the assets you left and who received them.
Easy modification: The settlor of a revocable living trust can modify it at any time and for any reason. This makes it easy to move assets into and out of the trust and to add or delete beneficiaries to the trust. A revocable living trust also allows the settlor to change the trust terms or replace the trustee as often as needed.
Easy termination: Just as it is possible to modify a revocable living trust, it is also possible to revoke or terminate the trust at any time.
The protection of minor children: A minor child cannot directly inherit from one’s estate. Instead, any property left to a minor will be managed by the person you appoint as the child’s guardian or conservator under your will. The individual so appointed to manage your child’s property will then be required to make periodic accountings to the court of how the funds have been spent – and such spending will be required to meet court approval. The child will then get any and all remaining property outright once they reach eighteen years of age.
Fortunately, a trust allows a trustee to protect and manage a minor child’s inheritance until he or she reaches adulthood. In addition, a trust allows a settlor to stagger a child’s inheritance instead of giving him or her a lump sum. A trust can also leave much more specific terms as to how you want your child cared for with what property you leave them.
Shelby County Estate Planning Attorney
At Berkley Oliver PLLC, located in Shelby County, Kentucky, our knowledgeable estate planning lawyers are here to provide you with comprehensive estate planning services. Regardless of your estate planning needs, our lawyers have the experience and knowledge necessary to provide you with efficient, reliable estate planning assistance. When you come to us for help with your estate planning needs, you can count on us to handle your matter with the utmost care, doing everything necessary to ensure that you and your family remain protected for years to come. Please contact us today to schedule an initial consultation.