Benefits of a living trust in estate planning
Your loved ones are important to you. When you pass away, you want to make sure that your assets get to them quickly and easily. But only using a will to distribute your assets can tie up your estate in probate court. Probate court can be expensive and time-consuming for your family.
One way you can help ease the distribution of your estate is to use a living trust. When properly used as a part of your estate plan, a living trust can make distribution much easier for your family. Here are a few benefits to using a living trust:
- Stay out of probate court – One of the biggest reasons people choose living trusts is to avoid probate. If you use a will pass along your estate, your entire estate must go through probate court. While in probate court, a judge decides the validity of your will, if there is any money or taxes owed on your estate and rule on any challenges to your will. Your will also becomes a matter of public record in probate. A living trust bypasses the time of probate court while staying private.
- You decide how to distribute – When you create a trust, you write rules about how it will distribute. Your trustee, the person you pick to run the trust, follows these rules after you pass. You can decide if your estate pays out all at once, stays in the trust for a certain amount of time, or is split up into separate trusts for different heirs.
- Assets outside of the trust can flow in upon death – You may not put all your assets in the trust right away. And certain accounts, like retirement accounts, cannot go in the trust before you pass away. However, you can set up any assets in your will and retirement accounts to flow into the trust when you pass.
A living trust can be one part of a good estate plan that makes distribution easier for your loved ones. However, the tools you need for an estate plan may be different. Consult with a lawyer to create the best plan for you.
A living trust can help make sure your family receives your estate easily and quickly.