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Is A Living Trust Right For You?

21 June 2016 by Kenneth Pierce

As part of estate planning, you have to decide whether or not you want to setup a living trust. A living trust has many benefits, but it might not be necessary in every situation. If you are unsure whether or not you should establish a living trust, here is what you need to know. 

Why Should You Have a Living Trust?

Many people who setup a living trust do so to avoid probate. When assets are transferred to the trust, they are no longer considered your assets. As such, the probate court has no say over them. Although this is one of the best reasons to have a living trust, there are many more reasons that could prove beneficial to you. 

For instance, a living trust helps to protect your privacy. Unlike a will, the trust is not entered into public record. If you do not want family, friends, and any other interested parties to know what assets you have, the trust will provide you the privacy you want. 

Another reason you should consider a living trust is that in the event that you are unable to make decisions for yourself, the trust outlines who has the right to make decisions on your behalf. Without the trust, a family member or other person would have to go to court to get approval to handle your affairs. 

When Is a Living Trust Not a Good Idea?

A living trust can be a complicated process that is time-consuming. Depending on the size of your estate, it might be easier to allow it to go through probate instead of setting up the trust. For instance, if you do not own real estate and have only payable-on-death accounts, such as your bank accounts, probate can be a simpler option. 

If you are married, a living trust might not be the best option. Assets that have both you and your spouse's name would go to him or her when you die. For instance, if you and your spouse are listed as owners of your home, your share of the home would become his or hers after your death. 

Exploring other options might be best if you are anticipating problems with your creditors after your death. Probate would give the creditors a limited amount of time to file a claim against your estate. If they fail to do so, their right to be paid would expire. 

An estate planning attorney can help you assess your situation and determine what is the best course of action to take to settle your estate after your death. Contact a business, such as Lynn Jackson Shultz & Lebrun PC, for more information.   

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