People may hear the word trust, and not truly understand that this legal document can have many different uses and different types. One type of trust is called a revocable living trust. This trust can help a person with their estate planning needs for a few different reasons. Unlike wills, trusts avoid probate court. While many people think that all of their estate will have to be divided through probate, a will can maintain privacy for the family and reduce costs associated with probate. Probate is a procedure that could allow the estate to become public record.
These trusts also help people to choose how their money is used after they pass away. If a beneficiary may have trouble managing the assets, a trust can help them by restricting the use of assets except for certain purposes. Many times these trusts hold financial accounts so these accounts are divided according to the trust.
Speaking with an experienced estate planning attorney might be a wise decision for anyone who wants to help limit the use of probate. Trusts serve many different purposes. Along with other estate planning documents, people can help ensure the efficient and successful transfer of their assets to beneficiaries.
Because this trust is revocable, a person can change the trust during their lifetime. Once a person dies the trust cannot be changed and the directions of the trust can help distribute assets.
Source: The Sacramento Bee, "Revocable living trust has benefits," Claudia Buck, Nov. 26, 2012
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