Why a Living Trust is One of the Best Options for Avoiding Probate
“Death is not the end. There remains the litigation over the estate.”
We believe it’s ideal that when someone passes away, the paperwork and material concerns associated with their estate are so flawlessly handled (thanks to thorough preparation) that they fade into the background, allowing the family and loved ones to grieve and remember in peace.
You’re probably wondering “How can assets and legacies be transferred to the next generation in a harmonious, stress-free, fair process?”
Well, the whole business of Estate Planning – or at least a major part of it – is concerned with ease. To that end, one primary goal of many people is to avoid the complications and costs involved with probate. We can assist with that.
While there are many “tools of the trade” that a qualified attorney can use to keep your assets out of probate - setting up a Revocable Living Trust is quite often the best, most comprehensive option for avoiding probate.
Why do we say that? Well, let’s discuss-
What is a Trust?
A Trust is a legal structure that permits management of your assets by a trustee on behalf of your family and loved ones. You can be the trustee for your own living trust until you are no longer able to manage your financial affairs or pass away, at which point the responsibility for managing the trust passes to someone you designate as a successor trustee. This can also prevent the court from controlling your assets if you were to become incapacitated.
How does a Trust help you avoid probate?
The purpose of probate is to transfer property ownership for all assets that were listed in your name when you passed away. A trust can bypass this process completely because your assets are transferred to the Trust while you are still alive. Therefore, when you die, there’s nothing that needs to be transferred by the probate court (everything’s already in your Trust). When a trust is structured correctly with the help of an experienced estate planning attorney, your entire estate can stay out of probate court entirely. This process not only limits court costs, but it also maintains the privacy of your financial records while enabling your family and loved ones to enjoy the benefits of the Trust without disruption or delay.
Doesn’t joint ownership avoid probate?
Not like you may think it does. True, when one owner of a joint account passes away, full ownership automatically transfers to the surviving owner without probate. However, concerns arise if the surviving owner does not add a new joint owner or worse, if the joint owners pass away at the same time. Then probate would be required in order to transfer ownership to the family that remained.
**Another concern to be aware of with joint accounts- when you add a co-owner, you lose control and your chances of being named in a subsequent lawsuit or losing assets to a creditor can be increased. There are concerns involving joint owned real estate as well. If you have, or are considering naming joint/co-owners on your assets, please contact our office to ensure all aspects are considered in protecting your assets.
While establishing a Trust can be a bit more involved, and the process can cost more upfront than a Last Will & Testament, if you’re willing to invest a little more up front to protect your family and assets, a Living Trust can be your best option for avoiding probate later.
That being said, as wonderful as Revocable Living Trusts can be – and we’ve only scratched the surface of their exciting features in this short post – always bear in mind H.L. Mencken’s warning that, “For every complex problem there is an answer that is clear, simple, and wrong.”
The key to planning effectively to minimize the likelihood of a drawn out, contentious, expensive process is to work with highly qualified, trusted people. We at Worley Elder Law genuinely care about you and your family and will work with you to forge the right strategy specific for you and your family.
Give us a call today to learn more about your next steps and to get the peace of mind you deserve.