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What is a revocable living trust and when do I need one?

On Behalf of | Jun 11, 2024 | Estate Planning

Estate planning is a process that allows an individual or family to control the transfer of their wealth. There are various legal tools that can help achieve this goal. One of which is the revocable living trust.

The revocable living trusts is essentially a flexible trust that the creator can control during their lifetime. Determining whether or not this legal tool would benefit one’s estate plan is a serious question. The following conversation points can help guide this discussion.

#1: Do you want to have control over the trust and asset distribution?

This type of legal tool is helpful if you want to proactively plan for the distribution of your assets after your passing. It allows you to specify the management and distribution of your assets, better ensuring your estate plan is in line with your wishes.

#2: Do you value privacy?

Unlike probate, which is a public process, a living trust maintains privacy. If you prefer to keep your financial affairs confidential, a revocable trust can help achieve that goal.

#3: Do you want some control even in the event of incapacitation?

A freak accident or serious illness can result in diminished mental capacity. In these situations, a living trust provides a mechanism for managing your assets when you cannot. The successor trustee steps in to handle financial matters without court involvement.

#4: What about efficiency?

If you want your loved ones to receive their inheritances promptly and without the delays associated with probate, a revocable trust can streamline the process.

These are just a few questions that focus on one specific estate planning tool. Those who are having these conversations are wise to consider all tools to better ensure they tailor an estate plan to their specific needs.

It is also important to note that there are some unscrupulous actors who will attempt to take advantage of those who are looking to build their estate plan. The State of California Department of Justice encourages those looking for a living trust to make sure they are speaking with someone licensed with the state bar and avoid those who go by titles like “trust advisor” or “senior estate planner” to reduce the risk of becoming the victim of a scam.