Many people do not set up a living trust, sometimes not because they can’t afford to, but because they don’t understand the needs for one. Why would you need to set up a living trust? The truth is, there are many reasons but the main ones are to avoid probate, conservatorship and to give powers of attorney to someone you trust.
Reasons to set up a living trust:
Did you know that 70% of Americans pass away without leaving any instruction regarding their estate? The estate of these people will have to go through the probate process before passing on to their loved ones. Even if the person has a will drafted up, the probate process still applies.
This process takes about 6 months to 2 years, sometimes even longer. During this time, your family and loved ones will not be able to take control of your assets. In the end, your assets will be return to your family once the probate is all over, but not all of it. 5 to 10% of the gross value of your estate will go to attorneys to cover probate fees.
If you have set up a living trust, the whole probate process can be avoided. Your assets can be transferred immediately to your heirs. There will be no delay and no fees eating into your estate.
Sometimes, the situation can get even more complicated when a person is alive but need extensive care, after an accident or due to an illness such as Alzheimer’s. Without a living trust, there will be no say to who would be able to take care of you in such situation. Even spouses don’t automatically get conservatorship of their partners if someone else also wants to claim conservatorship. The matter will have to go to court.
Having set up a living trust is the only way you can appoint someone to take conservatorship should anything happen to you.
Powers of attorney
A bad accident or health issues can also render someone incapable of making decisions, such as paying bills or provide for the family. Your loved ones may need to access your bank account in order to pay for your medical care and other expenses. This cannot be done if your spouse, adult children or other family members do not have the powers of attorney.
With a living trust, you can give instructions in advance should anything happens to you. You can choose who to have powers of attorney. That person will be able to take control immediately without a long court process and expensive fees.
These are only three among many reasons to consider setting up a living trust. Ultimately, the goal of estate planning is to make sure that your estate is passed on to the rightful hands with the least hassles. Your loved ones do not need to be put through long, expensive probate period, nor do they need to be left stranded without the means to take care of you or themselves. Contact a Heritage living trust specialist today to find out how you can protect your family’s future.
Related Search Terms:
- Why set up living trust
- Create a Living Trust
- Benefits of a Living Trust
- Living trust vs will
- Living trust and probate