What is A Living Trust?
A living trust is a type of trust created for the purpose of holding ownership to an individual’s assets during the person’s lifetime and for planning the distribution of those assets after the person’s death.
A living trust has essentially three parts to it: the trustor, sometimes called a grantor, or the one who creates the trust; the trustee, or the one who will carry out the wishes of the trustor; and the beneficiaries, or the ones who will benefit from the trust, when the trustor has passed on.
How Does a Living Trust Differ From a Will?
What makes a living trust dissimilar from a will is the difference in cost to you and your heirs, the difference in flexibility and control of your interests, and the public or private way in which each is handled. A will can cause everything to go into probate, generate huge legal fees and court costs, drag your family’s private business through months and years of public scrutiny and still not end up with a distribution of your wealth as it was intended. A Living Trust will take the control of your assets out of the court to avoid probate and distribute your wealth the way you want and in as private a manner as your family deserves.
Is the Idea of a Living Trust New?
Living Trusts have been around since seventeenth century England. In a time when kings worried about a growing middle class, they sought to gain land upon the death of an owner. As a protection from the greedy kings, these landowners found a way to get around this unwanted distribution of their wealth. These commoners would deed their assets before they died to someone in the Church who could be trusted to allocate the funds back to the family and to the landowner’s true heirs. A Living Trust is one of the most common estate planning tools in use today.
Can I Do It Myself or Do I need An Attorney?
There are lots of situations that can seriously eat up your hard-earned assets upon your death. The estate that you intended to leave your loved ones will hardly be recognizable once it has gone a round or two in the courts or been contested for almost any reason at all. Not only do you want your estate to stay out of probate court, but you will want someone to conduct your business for you before you die, in the event that you become incapacitated and cannot act on your own behalf. You will want to have an attorney who has considerable experience in all of these matters, is local and therefore knows the local laws, and is someone who is knowledgeable enough and who you can entrust to do for you what you cannot do yourself. You will need an attorney who does Estate Planning in your area.