Copyright 2004 Riley Legal Group
HOW CAN THE USE OF A TRUST SAVE MONEY IN ESTATE PLANNING?
A Revocable Living Trust and a Last Will and Testament have the same ultimate purpose-to settle a person's financial affairs after death. However, the use of a Revocable Living Trust can be used to eliminate the cost, time and publicity of probate. Here is how that occurs:
FIRST: The Revocable Living Trust is established during your lifetime rather than at death. By taking this step, you are making specific instructions as to who will take care of your affairs if you are incapacitated or deceased. If you are incapacitated, the person you have named (called Successor Trustee) IMMEDIATELY takes over the handling of your financial affairs and (if you wish) your personal needs. That person IS NOT REQUIRED to hire a lawyer to set up a Guardianship and DOES NOT have to go to Court to obtain approval for acting on your behalf. This arrangement saves money, time and publicity.
SECOND: At death, the Successor Trustee takes control of the person's assets, pays his or her legitimate bills and taxes and then distributes the assets according to the deceased person's wishes. Because the assets are held in a Living Trust, there is NO REQUIREMENT to go to probate court, NO REQUIREMENT to hire an attorney to handle the legal work associated with probate and NO OBLIGATION to disclose the deceased person's financial affairs to anyone except those persons named in the trust to receive assets. Once again, the trust arrangement saves money, time and avoid public disclosure of the deceased person's private financial matters.
THIRD: Instead of waiting the mandatory period of time required by the probate process, the Successor Trustee can complete the settlement of the trust as quickly as he or she is able to do so.
FOURTH: If the person who sets up a trust decides to change the terms of the trust, he or she can simply do so by making and signing a relatively inexpensive and simple amendment to the trust.
In summary, both a Last Will and Testament and a Revocable Living Trust will effectively settle a person's financial affairs at death. However, the Trust will also keep the individual's assets properly managed by a trustee in the event of incapacity (which the Will cannot do) and has the ability to settle the person's affairs at death in a more streamlined manner.
A Revocable Living Trust and a Last Will and Testament have the same ultimate purpose-to settle a person's financial affairs after death. However, the use of a Revocable Living Trust can be used to eliminate the cost, time and publicity of probate. Here is how that occurs:
FIRST: The Revocable Living Trust is established during your lifetime rather than at death. By taking this step, you are making specific instructions as to who will take care of your affairs if you are incapacitated or deceased. If you are incapacitated, the person you have named (called Successor Trustee) IMMEDIATELY takes over the handling of your financial affairs and (if you wish) your personal needs. That person IS NOT REQUIRED to hire a lawyer to set up a Guardianship and DOES NOT have to go to Court to obtain approval for acting on your behalf. This arrangement saves money, time and publicity.
SECOND: At death, the Successor Trustee takes control of the person's assets, pays his or her legitimate bills and taxes and then distributes the assets according to the deceased person's wishes. Because the assets are held in a Living Trust, there is NO REQUIREMENT to go to probate court, NO REQUIREMENT to hire an attorney to handle the legal work associated with probate and NO OBLIGATION to disclose the deceased person's financial affairs to anyone except those persons named in the trust to receive assets. Once again, the trust arrangement saves money, time and avoid public disclosure of the deceased person's private financial matters.
THIRD: Instead of waiting the mandatory period of time required by the probate process, the Successor Trustee can complete the settlement of the trust as quickly as he or she is able to do so.
FOURTH: If the person who sets up a trust decides to change the terms of the trust, he or she can simply do so by making and signing a relatively inexpensive and simple amendment to the trust.
In summary, both a Last Will and Testament and a Revocable Living Trust will effectively settle a person's financial affairs at death. However, the Trust will also keep the individual's assets properly managed by a trustee in the event of incapacity (which the Will cannot do) and has the ability to settle the person's affairs at death in a more streamlined manner.
