Did you know that setting up a living trust means creditors won’t get their hands on any assets you leave behind for family or friends? So, a living trust certainly has its advantages.
“A living trust, also known as a revocable trust, allows the trustmaker to provide for their loved ones without the need to undergo the costly and lengthy probate process,” says Gideo Alper, a Florida lawyer specializing in estate planning at Alper Law. “A living trust also enables the trustmaker to control the timing and manner of transfers after their passing.”
A previous survey finds that 56% of Americans believe estate planning is essential — yet a mere 33% of adults in the U.S. have gone through with proper estate planning. Of the estate plans done in 2021, the breakdown was as follows:
- 75.12% were for wills
- 18.78% were for trusts
- 6.1% were for selecting guardians for their kids
If you want to set up a trust as part of your estate planning strategy, one option is a living trust. Continue reading for five reasons to consider calling a lawyer to get one set up for yourself.
- Safeguard Minor Children
One reason to consider setting up a living trust is that you can safeguard your young kids. You can use a living trust to store money for minor kids until they are old enough and mature enough to manage the money independently. A lawyer specializing in estate planning can help you determine how best to allow your kids access to the money. Some parents, for instance, choose a process where access to the money is incrementally permitted when their kids are 20, 25, and 30. So, by the time they’re 30, they’ll have full access to all the money placed in the living trust.
- Keep Assets in the Family
A living trust will also help you keep the assets you worked hard for in your family. Case in point: you can use a living trust to ensure that a son-in-law or daughter-in-law don’t walk off with 50% of assets you intend to transfer to your daughter or son in the event of a divorce. A living trust will protect assets and keep them within the family circle.
- Steer Clear of Probate
One of the things you’ll want to steer clear of is the probate process. Your loved ones, specifically those you leave assets for after your passing, may be hit with a heavy blow in terms of probate taxes. But you can avoid this by putting assets into a living trust. Leaving things to family members in your will won’t spare them from the dreaded probate process. You can count on a lawyer to help you set up a living trust that will legally sidestep the probate process.
- Protect Yourself While You’re Alive
Setting up a living trust can protect you during your lifetime. If you have a living trust and become incapacitated at some point in your life, the person you name as the trustee will step in and manage the assets you placed in the trust in your best interests.
So, it goes without saying that you’ll want to select the right person to fill this vital role. While no one wants to think they’ll ever become incapacitated and unable to take care of themselves, it’s best to hope for the best and plan for the worst. It’s in your best interests to have a living trust in place, and that’s all the more true if you’re a single person with no dependents.
- Safeguard Your Family’s Privacy
Yet another reason to set up a living trust is that you can safeguard your family’s privacy. If you leave possessions to family in a will, whatever you transfer to loved ones will be part of the public record. Your assets will all be listed — and that might not be what you want for yourself or your family members. However, a living trust is a private document that won’t automatically be part of the public record.
Some good reasons exist to consider setting up a living trust. You’ll want to see a lawyer specializing in estate planning to see how a living trust can help you and yours now and in the future.