When you are planning your estate, you may want to consider the creation of a revocable living trust. For the most part, these trusts are popular because they facilitate the transfer of monetary assets outside of the process of probate.
Your estate must be probated when you use a last will rather than a trust to express your wishes regarding the distribution of your resources after you die. The probate process comes along with some significant pitfalls.
Most people are going to want to facilitate timely asset transfers. Probate can take around a year to run its course in routine cases, and complicated cases can take much longer. The heirs to the estate are not going to receive their inheritances until after the estate has been probated.
Significant expenses can also accumulate during the probate process, and this is another one of the drawbacks.
When you use a revocable living trust rather than a last will to facilitate the transfer of your assets to your heirs, the distributions take place outside of the process of probate.
The Successor Trustee
Some people who are not completely informed decide that they are not interested in creating a trust because they don’t want to surrender control of the assets while they are living. In fact, you don’t lose control of assets that you convey into a revocable living trust while you are still alive.
You can act as the trustee and the beneficiary while you are living. Because of this arrangement, you maintain control of the assets. The trust is revocable, so you can actually dissolve it and re-assume personal ownership of the assets that comprise the trust at any time.
When you create a trust agreement, you name a successor trustee and a successor beneficiary (or beneficiaries). After you die, the successor trustee distributes the assets that have been conveyed into the trust to the beneficiary in accordance with your wishes as stated in the trust agreement.
You should choose someone who has significant financial acumen when you are naming a successor trustee, but there are other considerations. The successor trustee is going to be acting after you die. Therefore, the age of the trustee is a factor. If you choose an individual who is your age or older, will this person still be alive and well when you pass away?
Even if the successor trustee is alive and capable of doing the job, what will happen after he or she dies? It is often a good idea to name several people so that you have a successor to the successor trustee if that becomes necessary.
To overcome these hurdles, many people decide to utilize a professional fiduciary entity such as a bank or a trust company to act as the successor trustee. An experienced and qualified estate planning attorney can help guide you with regard to successor trustee options.
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