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LIVING TRUSTS

Too often, we neglect to fully plan our estates to help our family members avoid probate whenever possible. Probate can be costly and extremely time-consuming, and may prevent your heirs from accessing funds they may need.

 

LIVING TRUSTS ARE A TOOL

One of the many tools available to you for estate planning is a living trust. Generally speaking, with a living trust you are named as trustee and you manage your assets just as you manage them today. However, with a living trust you must move your assets into the trust in order for them not to become subjected to probate. Some of the assets that may be moved into a living trust include:

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• Non-jointly held bank accounts

• Certificates of deposit

• Automobiles

• Recreational vehicles

• Primary residence and vacation homes

• Any financial accounts that do not have a specific named beneficiary

 

TRUSTS MAY BE REVOCABLE OR IRREVOCABLE

Simply put, you maintain complete control over the assets in your trust and how those assets are distributed at the time of your death. With an irrevocable trust, it is not possible to change the terms of the trust at any time. A revocable trust, however, allows you, as the trustee, to dissolve the trust.

 

NAMING A SUCCESSOR TRUSTEE

Unless a specific person is named as a successor trustee, all assets in the trust must still go through the probate process. Therefore it is important to name a person whom you feel will act in the best interests of your heirs. When properly written, a living trust will specify how any assets are to be disbursed upon your death. Once those assets have been disbursed, the trust is then dissolved.

 

A WILL IS STILL NECESSARY

Even if you have a living trust, it is still necessary to have a will. In many cases, there may be assets that are unable to be transferred into the trust, especially small personal property such as jewelry, paintings and household furnishings. However, larger assets that have more value may typically be placed in trust and the title held by the trust.

 

USING YOUR TRUST EFFECTIVELY TO AVOID PROBATE

One of the most common mistakes people make when creating a trust is failing to name a successor trustee. If a successor is not named, the assets in the trust are then subject to full probate. This means more costs, and a longer time before your assets are distributed per your wishes.

 

If you are considering a living trust or you are just beginning to plan your estate, contact Solomon Richman, P.C. at (516) 437-6443 and ask to speak with one of our estate planning law attorneys. We will set up a consultation and work with you to set up a plan that works for you including a living trust.