A living trust is an estate planning tool that can provide numerous different benefits that you would not receive if you use a last will as the centerpiece of your estate plan. For one thing, if you use a will, you would be leaving lump sum inheritances to your heirs. If you have spendthrifts in the family, they could burn through their inheritances recklessly.
With a living trust, you would not have to be concerned. You can act as the trustee while you are living, so you control the trust, and this can be comforting. In the trust declaration, you name a successor trustee to take over the role after you pass away.
You can leave behind specific instructions that the trustee would be compelled to follow regarding the way that the assets will be distributed to the beneficiaries.
To provide an example of the possible spendthrift protections, you could instruct the trustee to distribute the earnings from the trust to the beneficiaries on a monthly basis. If you want to, you could allow the trustee to distribute portions of the principal under certain circumstances.
When you are choosing a successor trustee, you could name someone that you know personally. However, this may not be the best choice if you want to include spendthrift protections, because the person could be personally involved with the beneficiaries.
If you use a corporate trustee like a trust company, you could be sure that your instructions will be carried out to the letter in a largely unemotional manner. Plus, there would be no longevity concerns, and the trust would be administered in accordance with professional standards.
The spendthrift protections can be important to you, but a living trust can provide additional benefits. After your passing, assets can be distributed outside of the probate process. This process can be time-consuming and expensive, and it is a public proceeding, so anyone who is interested can find out how you distributed your assets.
You avoid these pitfalls if you use a revocable living trust as the centerpiece of your estate plan.
Free Report on Revocable Living Trusts
We have provided a bit of basic information about living trusts in this blog post. If you would like to dig deeper, we have a valuable resource that you can access through this website.
Our firm has prepared a series special estate planning and elder law reports, and one report is dedicated to living trusts. The report is being offered free of charge, and you can visit this page to access your copy: Living Trust Report.
Take Direct Action
Our firm would be glad to assist you if you are interested in creating a living trust. We offer free consultations, and you can contact us through this page to set up an appointment: Dallas TX Estate Planning Attorneys.