A revocable living trust is a legal document that allows you to transfer your assets to a trust during your lifetime. The trust then becomes the legal owner of your assets, and you can continue to manage and use them as the trustee of the trust.
One of the primary benefits of a revocable living trust is that it can help you avoid probate. Probate is the legal process that takes place after someone dies, during which a court oversees the distribution of the person’s assets to their heirs or beneficiaries. Probate can be time-consuming, expensive, and public, so many people prefer to avoid it if possible.
When you create a revocable living trust, you transfer your assets to the trust, and they become the property of the trust. Because the trust is a separate legal entity, it can continue to own and manage the assets even after you die. You can name a successor trustee to take over management of the trust after your death, and they can distribute the assets to your beneficiaries according to the terms of the trust.
Because the assets are owned by the trust, they are not subject to probate. The successor trustee can distribute them to your beneficiaries without the need for court involvement. This can save time and money and also provide greater privacy, as the details of the trust are not made public in the same way that a will and probate proceedings are.
However, it’s important to note that a revocable living trust will only help you avoid probate for assets that are properly transferred into the trust. If you forget to transfer an asset, it may still be subject to probate. Additionally, some assets, such as retirement accounts and life insurance policies, have designated beneficiaries and pass outside of probate, regardless of whether they are owned by a trust or not.
It’s important to consult with an attorney to ensure that your estate plan is properly structured to meet your goals and avoid unnecessary complications. If you would like to find out more about whether a Revocable Living Trust is a strategy that will work for you and your family, give us a call to set up an appointment. We can help you think through how to design your trust in a way that achieves your goals and protects the inheritance you want to leave for family members and loved ones.
Call our office at 410-721-1660 or fill out our contact form to schedule a meeting and we will be in touch to get that scheduled.