When it comes to estate planning, you may think of a will first. Your attorney would probably also recommend a will. However, while a will can be helpful to get your assets distributed after you pass away, it may not be enough and it may not be what you want for your family. Consider all the risks before you choose a will without considering a revocable living trust.
The limit of a will
A will can only come into effect after you pass away, not a moment earlier. In many cases we saw, it will create problems in the unfortunate case of a severe accident or illness that leaves a person alive but incapacitated. The person is now unable to sign any paper or release any of the assets to cover his medical expenses or to provide for his family. However, the assets remain under his name, because the will has not taken effect just yet. That means the family is left stranded without any way to retrieve and liquidate the assets if they need to.
This is just one reason why having a will is not enough. It does not offer any instructions while the person is still alive, even if he or she can no longer make any decisions. Why would you leave your family at the risk of such hardship?
How a revocable living trust can prevent the risk
On CNBC The Suze Orman Show, Orman discussed a solution for this. She recommends people to get a revocable living trust instead of a will. A revocable living trust fills in the gap that a will leaves open.
With a living trust, you can give specific instructions to how your assets can be distributed and managed if you ever become incapable of doing so. Until that day comes, you remain in total control of the assets, as the trustee of the living trust. Unlike an irrevocable trust, a revocable trust keeps the ownership and total control in your hands as long as you wish, even after you transfer the assets into the trust.
A living trust will also eliminate the probate process, which is required for a will. The process often takes a long time to complete. During this time, the court will try to validate a will and transfer the titles to the heirs. It also costs quite a lot of money, usually from 3 to 5% of the asset value.
With a revocable living trust, you can transfer all your assets into the trust right after you set it up. This way, when the time comes, all assets can be transferred to your family members or whoever you wish immediately. There is no delay, and there is no probate fee.
To learn more about a revocable living trust, talk to a living trust specialist at Heritage Living Trust.
Related Search Terms:
- Revocable Living Trust
- Living Trust vs Will
- Benefits of a Living Trust
- What Is a Revocable Living Trust