A comprehensive estate plan can protect your assets and loved ones during your lifetime while ensuring that your wishes are honored when you pass on. One of the most important estate planning tools that you can use to safeguard your assets, legacy and loved ones is the living trust.
A living trust is a legal document that allows you to nominate a third party, known as a trustee, to hold certain assets on behalf of your beneficiaries. You can set up your living trust in various ways and specify the terms under which the assets will be made available to the beneficiaries. This allows you to control your assets even after passing on.
Here are some of the reasons why you should consider including a living trust in your estate plan.
Avoid the costly probate process
Probate is the legal process by which the court authenticates the deceased’s will and approves its execution. Or, if you die intestate, the court decides how your assets are distributed based on the state’s intestacy laws. Now, probate can be a time and resource-intensive process, especially if you died without an estate plan.
One of the main benefits of setting up a living trust is that assets held in the living trust do not have to go through the lengthy and costly probate process. Thus, a living trust can save your estate a significant amount of money, and this means that your beneficiaries will get more property.
Safeguard your privacy
A living trust allows you to keep your assets and estate plan out of public scrutiny. How so? If all you have is a will, or no estate plan at all, your estate will have to go through probate, which is a public process.
A living trust, on the other hand, remains a private document unless someone decides to contest it, of course. The only people who will get to know its content and terms are the parties involved (the trustee and your beneficiaries).
A living trust is an excellent estate planning tool that can help you accomplish your wishes both during your lifetime and after death. These are some of the benefits that you are likely to realize when you include a living trust in your estate plan.