Living trusts are flexible estate planning tools that can offer you many advantages, five of which are mentioned below:
1. Revocable. Because the needs of family members may change over time, a living trust normally allows you to modify trust provisions or change the beneficiaries.
2. Private. A living trust avoids the costs and delays of probate—the state-sanctioned system that oversees the administration of your estate. Because a living trust is not subject to public scrutiny, your beneficiaries and the specific amounts or percentages they receive remain confidential.
3. Continuous. Assets put in a living trust stay under the control of the trustee, until you choose differently. When the trust is established, you can name a successor trustee who will carry on financial responsibilities in the event of your incapacity or death.
4. Flexible. You may add other assets to the trust during your life. The living trust can be especially useful if you own real estate in another state by eliminating the need to have a separate probate proceeding in the other state.
5. Professionally managed. Though not exclusive to living trusts, banks are generally well prepared to act as trustee. Also, some attorneys are willing to take on the task. Through prudent investing, these individuals can help make the most of your trust's assets and ultimately deliver more money to your beneficiaries.
A living trust is a remarkable financial and estate planning tool. To secure the plan best suited to your individual needs, be sure to consult an attorney who is knowledgeable about the features and benefits of living trusts.
SOURCE: University of Georgia in an article written by Mary L. McCormack