When it comes to estate planning, people have many options. A living trust is one of the most practical and flexible choices. What is a living trust, and how does a person write one? The answers to these questions can be read below.
How Does a Living Trust Work?
One of the most common reasons living trusts are so popular is that they are not subject to probate, according to realtimecampaign.com. A living trust allows people to ensure their loved ones will receive a rapid transfer of assets without all the red tape of probate.
There are two types of living trusts. People can change a revocable trust at any time. An irrevocable trust cannot be changed. Writing a living trust may seem daunting, but it does not have to cause stress.
Checklist for Forming a Living Trust
No matter the type of living trust chosen, some specific tasks become necessary. Understanding these tasks allows people to make the right decisions. An ”Attorney says it’s important to have a living trust — and to update it when necessary.” Those interested in living trusts need to consider the following checklist items to ensure they become prepared.
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First, a person needs to make a list of their owned assets. Once listed, the individual needs to determine which assets they will include in their living trust. To take advantage of a living trust, people need to list every asset that would normally go through probate. Having everything they own listed offers a streamlined approach to avoiding probate.
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Gathering all the necessary paperwork is beneficial. Titles, deeds, life insurance policies, and stock certificates will prove helpful in creating a living trust. Those interested in receiving legal help should contact CunninghamLegal.
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Will the person become the sole grantor? It is important to note that a person can only put property they own into a trust. If a property is owned jointly, drawing up a shared trust is wise. Having two individual trusts is also an option.
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Next, people need to choose their beneficiaries. Those receiving the trust property are called beneficiaries. Beneficiaries may include family members, friends, and even associates. It is important to note that living trust beneficiaries are entirely different from insurance policies or retirement savings accounts.
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Individuals will also need to select a successor trustee. The successor trustee is in charge of paying any debts and distributing all assets according to the stipulations in the living trust. Before finalizing a successor, people should ensure they have a talk with their selection.
Get Legal Help for Writing a Living Trust
Although people have the option of writing a living trust without the help of a lawyer, this is not always wise. Meeting with a lawyer for a consultation appointment is the least a person can do to understand the living trust process.
A lawyer will help a person through the process of writing their living trust from start to finish. Having a lawyer working on their behalf offers individuals peace of mind knowing their loved ones will receive their inherited assets.
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