While a last will and testament is a very popular method of passing an estate to one’s beneficiaries, a revocable living trust is another great option. Our Virginia estate planning team tells you everything you need to know about this useful tool below.
What is a Revocable Living Trust?
A revocable trust is established when the grantor signs a trust agreement naming another individual a trustee to administer the trust. Grantors also have the ability to be a trustee as well, however, a co-trustee must also be named in order to ensure the consistency of management in the event of death or incapacitation. Naming a trust company or even a bank as the trustee, rather than an individual, ensures a qualified trustee will always be available to act in the grantor’s best interests.
In most cases, grantors retain certain rights over the trust during their lifetime. These generally include:
- The right to direct the trustee to distribute all or any portion of the trust property, in accordance with the grantor’s wishes
- The right to change or revoke the trust at any time
The trustee’s powers typically include the right to make discretionary distributions of income and principal to the grantor and, at times, their family if the grantor becomes incapacitated.
When the grantor passes away, the trust acts much like a will, and the property is distributed to its beneficiaries as outlined within the agreement.
The Benefits of a Revocable Living Trust
Having a will has both immediate and long-term benefits.
Due to the cost and time-consuming nature of probate, the ability of a revocable living trust to avoid it is one of their foremost benefits. This can be particularly advantageous if you own real estate in more than one state, and you are able to avoid multiple probate proceedings.
Your Property Remains Available to You
Revocable trusts are one of the best ways to ensure that your property remains available to be used for your benefit should you become incapacitated or incapable of making your own decisions.
If you become disabled and you have neither a revocable trust, an expensive, lengthy, and potentially embarrassing court proceeding is generally required to appoint a conservator or guardian before your property can be used to benefit yourself or your family.
Upon your passing, the assets in your revocable trust are immediately available to pay estate taxes, administration expenses, and outstanding debts without waiting for a probate decree or preliminary letters. If the trust is funded prior to your death, the property in the trust remains in the trustee’s name before and after your passing, and is immediately available for liquidation should it become necessary.
Get in Touch with TrustBuilders Law Group Today
Revocable living trusts hold a number of advantages that allow you to avoid probate and ensure the best interests of both yourself and your family and held intact no matter what happens.
If you would like to establish a revocable living trust, but are unsure of where to start, our seasoned estate planning team can help you every step of the way. Contact us through our website or give us a call at (757) 500-5135 today to schedule your consultation!