There are a few major benefits that living trusts provide that are widely publicized. One of them is the fact that the administration of a living trust takes place outside of probate. A will would be admitted to probate, and there are some negatives that go along with the process.
Probate expenses absorb a portion of the estate before it is distributed, and the records are available to the general public, so there is a loss of privacy. There is also a waiting game because no inheritances are distributed while the estate is being probated, and it will take months.
The other benefit that is always emphasized is the ability to protect an heir that is not ready to handle a large amount of money. You do not have to provide a lump sum bequest distribution, and the trust would be protected from the beneficiary’s creditors.
In addition to these very attractive benefits, there are some other advantages that you may not be aware of, and we will look at them in this post.
Married Couples
If you and your spouse are looking for an effective way to plan your estate, a joint living trust can be a good option.
Yes, you can establish a trust in tandem with your spouse, and this can be a good idea if most of your property is owned jointly you are going to leave your respective interests to one another.
You would act as co-trustees of the trust, and it would be revocable, so either party would be able to rescind or dissolve the trust at any time.
Property that is separately owned can also be conveyed into the trust, and you can name different beneficiaries if you choose to do so. The surviving spouse would be the sole trustee after the death of their spouse, but they would not be able to change the terms that apply to separate property.
Incapacity Planning
No one wants to think about disturbing possibilities, but you have no choice if you want to be properly prepared for the eventualities of meeting. Over 30 percent of people that are 85 or older have Alzheimer’s disease, and there are other causes of cognitive impairment.
In addition to cognitive difficulties, there are people that become unable to handle their finances when they are battling serious medical conditions. When you have a living trust, you can account for incapacity.
You can name a disability trustee to manage the trust if it ever becomes necessary. This can be the same individual or entity that will administer the trust after your passing, but you could empower someone else to act as the disability trustee.
Easy to Revise
They say that the only constant is change, and this can definitely apply to circumstances that impact your estate plan. If you have a living trust, you can make relatively minor changes by creating an amendment, so there is inherent flexibility.
If you want to completely disinherit a beneficiary or make major changes because you have gotten remarried, you can use a trust restatement.
Personally Held Assets
You do not have to be concerned about assets that are in your direct personal possession at the time of your passing. When you are establishing your estate plan, you can include a pour-over will, and this document will facilitate the transfer of the assets into the trust.
Living Trusts Are Affordable to Create
Some people are interested in trusts, but they assume that the legal fees will be considerable. In fact, we find that most prospective clients that we speak with are pleasantly surprised when they learn about our rates.
At the end of the day, a properly constructed estate plan can ultimately keep more of your money in the family.
Schedule a Consultation Today!
We know that it can be hard to discuss personal matters with an attorney you have just met. Everyone on our team is sensitive to this dynamic, and you can rest assured that you will feel perfectly comfortable from the first moment you walk through our doors.
If you are ready to get started, you can schedule a consultation at our estate planning office in Glastonbury or Westport if you call us at 860-548-1000. There is also a contact form on this site you can use if you would prefer to send us a message.
Mr. Nirenstein is licensed to practice before the courts of the State of Connecticut and the United States District Court. He is a member of the Connecticut and Hartford County Bar Associations, and the Estate and Probate, Elder Law, Business Law and Real Estate Sections of the Connecticut Bar Association.
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