You may have heard of a revocable living trust (RLT), which is a commonly used estate planning solution. But what exactly are they, who is affected by them, how can they be changed, and what do they accomplish? What Are They?
Part 3 - What Goals Can an RLT Help Accomplish?
Avoid probate. When you pass away, none of the assets properly titled in the trust will need to go through a long and potentially expensive probate process that could delay a beneficiary’s access to those assets for months or even years. In addition, the trust assets will be distributed privately, and do not become part of the public record, as is the case when a will must go through the probate process, which is overseen by a court. All probate files, including wills, asset inventories, and distribution reports, are open for any member of the public to review, but your family’s privacy is preserved when assets are distributed according to an RLT.
Protect inheritances. You can include provisions in your RLT that will help ensure that, after you die, the trust assets intended to benefit the next generation will not be spent too quickly, vulnerable to creditors, lost in a divorce, or wiped out as a result of other life events your beneficiaries may experience.
Plan for your own incapacity. Although an RLT allows you to retain control over your assets, it is important to plan ahead in case you are unable to do so in the future. In an RLT, you can authorize a co-trustee or a successor trustee to manage the trust property if you become incapacitated as a result of an illness, accident, or incapacity. Otherwise, your family member will have to rely on a financial power of attorney or go to court to ask for legal authority to manage your finances.
Want To Know More?
Navigating an RLT can be confusing, but we are here to help. If you are concerned about protecting your assets, we can help you. Click here to email us or call us at 309-807-2885 for your FREE 15-minute consultation.