For most people, a carefully prepared will and, in the case of incapacity, powers of attorney are sufficient for a complete estate plan. However, there are times when a revocable living trust may be preferable. How does one decide which is a better choice for their circumstances?
A Revocable Living Trust (aka “living trust”) can allow your estate to avoid probate while allowing you to maintain control over your property and other assets. By avoiding probate, your estate can potentially save time, money and ensure privacy. Although a properly drafted Texas will is not difficult to probate, if you are a Texas resident and own real estate in multiple states, a living trust can avoid the cost of multiple probate proceedings in additional states. In addition, since estate assets and beneficiaries are listed publicly during probate, greater privacy is secured in avoiding probate with a living trust. Furthermore, a living trust may make it less likely that beneficiaries challenge your final wishes, greatly reducing the likelihood of family discord during an already difficult time.
In the event of your incapacity, a carefully drafted living trust can provide the instructions necessary for your successor trustee to manage your estate. A well-drafted trust can provide enough direction so that a court-appointed guardian over your estate is not required. Additionally, a living trust is almost always accepted, but in some situations, your powers of attorney may not be.
Due to the relative ease of probating a will in Texas, a living trust is not suitable for all estates. Such a trust can be difficult to maintain, as it is important that all assets are transferred to the trust for it to be useful. Hence, excellent and detailed record keeping is extremely important, and this may be more costly in time and money than some families are willing to commit.
If you are considering whether a living trust is right for you, you should consult with an experienced estate planning attorney to help review your estate. There are many options to consider based on your family’s unique needs.
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