As part of your estate planning, you have to decide whether or not you need a living trust. A living trust establishes you as the person who is in charge of taking care of decisions related to your property. Here are three good reasons that you should include a living trust in your planning.
The best reason to have a living trust is that your heirs can avoid probate when you die. When you establish the trust, you can move ownership of your property to it. For instance, you can setup the trust as John Doe Trust and then transfer your property to it.
Once the property is legally under the trust's direction, you can list who you want to inherit it when you die. After your death, the executor of your estate will merely carry out the orders of the trust and ensure your heirs receive their property. To do this, your executor does not have to worry about going to probate court.
Probate court could tie up your property for months. In some instances, it could last a year or longer. By avoiding probate, your heirs do not have to wait that length of time.
One of the issues that can come up after your death if you are married is that your spouse could be incapable of managing your final affairs. If this happens, family members could go to court and try to get a conservator over your affairs. If this happens, your spouse could lose all control over his or her finances and the property you meant for him or her to keep.
To avoid this scenario, you can setup a trust. When you establish the trust, you can also have several trustees listed to help manage your property when you die. They will help to ensure that your final wishes are carried out. This means your spouse or partner will get what he or she deserves without having to go to court to fight for it.
Avoid Court Challenges
An unhappy family member could try to challenge your living trust. Living trusts usually hold up in court. The court considers the fact that you were in your right mind when you made the trust and it is a true representation of your wishes for your property.
When the trust is established, your estate planning attorney will ensure that the documentation on it is perfect so that there are no issues that your family members could try to exploit to their advantage.
A living trust is not always necessary, but you should consider it. Talk to your attorney (from Vandeventer Black LLP or another firm) about whether or not one is right for you and your financial situation.