There are different types of trusts that are used in the field of estate planning. The correct choice will depend on the circumstances. People who would like to maintain control of their assets while facilitating efficient postmortem transfers often choose revocable living trusts.
When you create a revocable living trust, you can initially act as the trustee and the beneficiary, so you don’t lose control of the assets. You can even revoke the trust if you choose to do so, and it would no longer exist. In the trust agreement you name a successor trustee and a successor beneficiary to assume these roles after you die.
The successor trustee can distribute assets to the successor beneficiary or beneficiaries outside of the process of probate. Probate is a legal process that can be time-consuming and expensive.
If you use a last will to facilitate the transfer of your personally held assets, the process of probate would be a factor.
Joint Living Trusts
It is possible to create a joint living trust with your spouse. The person creating a trust is called the grantor. You and your spouse could both act as grantors, and you could be co-trustees while you are both living.
The joint living trust can make sense if you and your spouse own much of your valuable property together. However, you could convey separately-owned property as well as jointly held property into the joint living trust.
When you create a joint living trust, you may want to leave your share of jointly held property to your spouse. This can certainly be done, but it is possible to name beneficiaries who would inherit your share of jointly held property. You can also name beneficiaries to inherit your personal property.
After you die, the trust would still exist, but your spouse would typically be the sole trustee, and he or she would have control of assets that remain in the trust after your wishes have been carried out.
Separate Living Trusts
If you are married, you do not have to create a joint living trust. You and your spouse could create two separate living trusts. This might make more sense if there was not a lot of jointly held property.
State Laws Matter
When you are considering a revocable living trust as a married person, the state within which you reside is a factor. Some states are community property states, and some states are separate property states. The definitions and implications are somewhat complex, and this is something that you should definitely discuss with a licensed estate planning attorney.
Free Special Report on Revocable Living Trusts
If you would like to learn more about the intricacies of revocable living trusts, download our special report. This report is being offered free of charge, and it will provide you with a solid foundation of useful information.
To access the report, click this link and follow the simple instructions: Revocable Living Trust Report.
John’s practice focuses on the use of Wills and Living Trusts in Estate Planning to help individuals protect their families and preserve their legacies after their deaths, but his practice also focuses on the critical issues of protecting individuals with dementia or other diminished capacity, assisting individuals in qualifying for Medicaid and other government benefits to offset the costs of long-term care, and providing special needs planning.
John is admitted to practice law in North Carolina, South Carolina, Kentucky, and Ohio, and he is accredited by the Department of Veterans Affairs.
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