As they say, there are only two things certain in this world: death and taxes. One you constantly prepare for as part of your civic duty. The other we tend to ignore until we reach an old age. And sometimes, it’s not soon enough. We aren’t really prepared for what can happen at any moment of any day.
So, the question is, if you were scheduled to meet your Maker today, would you be prepared? Would your loved ones be taken care of? And what would happen to all your cherished possessions? These are questions you must be prepared to answer now. The only way to do it legally, to ensure you’re protected, is to get a living trust.
A living trust is created by you during your life to ensure your final wishes are carried out the right way. It works a lot like a living will. You will want to create special directions to be carried out for each of your heirs and dependents. If you were to die today, who gets what? It’s a morbid question, but there are many reasons why we need to be 100% prepared for this day.
The difficulty with wills is they can be challenged. Probate can be common and it’s a nasty, expensive procedure that often threatens to break families apart over material possessions and money. Your living trust will force your directions to be fulfilled in the same manner you wrote it. There’s a trustee who is charged with ensuring those wishes are met.
One way a living trust improves upon a will is that there’s more behind getting a trust. A will can be contested if a family member says it was written while you were incapacitated or not in your right mind. It’s not uncommon for warring families to waste thousands of dollars and spending years fighting over a perceived inheritance.
A living trust goes through the motions of proving you were competent, so it cannot be contested like a will can. This is mostly used by people with complex financial circumstances or even unique personal assets. For example, if you have a blended family, a lot of assets, or a massive chunk of money saved up. There are plenty of Americans who have all three.
The reality is, planning for the end of your life is a sensitive and complicated idea. We don’t expect the worst to happen anytime soon. You hope it happens once you’re well retired and deep into your golden years. That’s what makes a living trust so important even if you’re younger. Let’s say you own a business. Who gets to run the business if you pass away untimely?
Rather than risking a major probate battle, an attorney who excels at estate planning the Woodlands, TX can help you draft the document that will stand in as the authoritative word on how everything will be handled. This is equally important for both married and unmarried people.
Let’s take a look at the three benefits of a living trust.
1) To Avoid Probate
A living trust will prevent your estate from going through probate hearing. Without it, there will be a court hearing where your assets are distributed. This can take a bit of time, sometimes even years! That’s never a good option, especially if you have kids. Since the living trust doesn’t go through probate, the process is much faster, meaning your heirs will get their inheritance quicker.
Another thing to consider is the probate process if you have assets out of state. Those assets would have to be settled in probate court in that state, requiring separate hearings and costing more money. A living will prevent that from happening.
2) To Save Some Money
A living trust is a more complex legal document to draft, so it’s going to cost more money than a will. It will take more time as well, considering you’ll have to transfer your financial accounts (bank accounts, stocks, et cetera) with different paperwork each time. But because you’re avoiding the probate, the cost at the time of death to distribute the contents will not include court costs and fees. That means the burden won’t be passed down to your loved ones.
3) To Gain Privacy
With just a will, your assets and transactions is a matter of public record and can be seen by anyone. With a living trust, you gain an added benefit of privacy. It’s drafted in private and the distribution of your assets will be in private as well.
Your passing will be difficult for your family. The more you prepare right now, the easier the process will be on them. Save them the added grief and court costs of probate hearings that get tied up for months and years by setting up a private living trust.