You have many different options when you are arranging for the eventual transfer of your monetary assets to your loved ones. The utilization of a last will is going to come to mind, but you can also consider alternatives.
If you retain personal ownership of your property up until the time of your death and arrange for its transfer through the terms of a last will, the probate process will become a factor.
A last will must be admitted to probate. The probate court will determine the validity of the will. When you create a last will you should nominate an executor or personal representative. This is the person that will handle the administration tasks. The administration of the estate is supervised by the probate court.
There are certain drawbacks that go along with this process. To put it briefly and succinctly, probate can be time-consuming and costly. The heirs to the estate do not receive their inheritances until this process has run its course.
When you hear about the drawbacks of probate, you may wonder if there are alternatives. The answer is yes, there are a number of different tools that can be used to facilitate the transfer of your assets to your heirs outside of probate. One very popular choice is the revocable living trust.
The Question of Control
People are sometimes reluctant to create trusts because they are concerned about losing control of the assets. This is not a problem when it comes to revocable living trusts.
A revocable living trust is just that, revocable. You can rescind the trust and once again assume direct ownership of any assets that you may have conveyed into it. The trust would no longer exist.
In addition to the right of revocation, you essentially control the assets that you have placed into the trust, even while it is still intact.
The anatomy of a trust is going to include a trustee. This is the individual or entity that administers the trust. The trustee would make and manage investments on behalf of the trust.
There is also a beneficiary. This is the person who would receive monetary distributions out of the trust.
While you are still alive, you can act as both the trustee and the beneficiary of a revocable living trust. As such, you maintain absolute control.
You name a successor beneficiary (or beneficiaries) and a successor trustee when you create the trust agreement. After you die, the trustee that you choose to succeed you distributes assets to the beneficiary. You decide on the nature of these distributions when you create the trust agreement.
Distributions from the trust to the beneficiary are not subject to the process of probate.
To learn more about the benefits of a living trust, attend one of our free Living Trust Seminar. To view a list of upcoming seminars and to register, follow this link: FREE LIVING TRUST SEMINARS.