There are a myriad of topics to consider while getting your estate in order. While a last will and testament can help to organize your property and assets, list your beneficiaries and name guardians, you may benefit by incorporating a living trust into your estate plan as well.
A living trust can help to keep your assets and property safe and secure during your life and distribute your possessions once you pass. It gives you additional options when it comes to leaving your legacy to friends and loved ones.
What is a living trust?
Living trusts can be either revocable or irrevocable, according to The Balance. You can edit or change the terms of a revocable living trust at any time. Once you place your property and assets into an irrevocable living trust, however, you essentially sign over ownership to the trust. You no longer have control over those items.
If you choose a revocable living trust, you can appoint yourself trustee and name a trusted friend or family member as the successor. Should something happen to you, the successor will step in and take control of the trust.
What are the benefits of having a trust?
The advantages of creating a living trust include the following:
- Avoid probate by transferring property and assets directly to beneficiaries
- Ensure property and assets remain with beneficiaries and are not split in divorce battles
- Ensure matters are kept private, as trusts are not matters of public record
- Arrange how the assets are distributed, whether in one lump-sum or gradually over time
A trust allows you to include specific details and contingencies. For example, you can specify that a child receives shares only after graduating from college or after reaching a certain age.
Creating a living trust not only helps you to organize your assets, but it helps to ensure your loved ones are taken care of once you pass.