What is a Living Trust
A Living Trust is a private agreement where the Trust holds the legal possessions of assets that belong to a Trustor (client) and then the beneficiaries after the client’s death. These assets remain under the control of the Trustor (client) during the client’s lifetime.
A Living Trust holds a number of other advantages, including avoiding Conservatorship and in some cases, it is also a great Estate Tax tool.
Why do you need a living trust?
A Living Trust will avoid probate for all of the assets that have been transferred into the trust. If you own a home, you need a Trust. In California, an estate with more than $150,000 in assets would be subject to probate without a Living Trust. Probate is expensive and time consuming. It can cost up to 5%-10% of the estate’s total value and take from 6 months to 2 years.
A Trust can avoid conservatorship. Conservatorship can be very costly and time consuming. A conservator is needed when someone loses the ability to control their own financial and personal affairs. A Living Trust appoints a successor trustee to manage the trust for the benefit of the trustor. Without this in place, the court will appoint a conservator with the power to handle the person’s financial affairs.
What does having a Living Trust involve?
You will need to decide:
- Who will manage and distribute your assets after you (and your spouse) decease.
- Who will manage your estate if you become incapacitated.
- Who inherits your assets and what percentage of Trust assets they receive.
- If you have minor children, a trust can appoint a guardian to your children.
You will need:
- An itemized list of your assets so the proper transfer documentation can be prepared.
- A copy of the deed to any real estate that you own.
A trust can be easily changed.
A change can be accomplished with a simple Amendment to the trust. An amendment does not have to be done by the original company or person who prepared your trust. INTEGRITY will provide Amendments throughout client’s life.
After your trust is created, any new property or bank or financial accounts should be opened in the name of the trust (excluding retirement accounts).
Living Trusts will save your family time and money while assuring that your wishes will be fulfilled. A Living Trust is a private document that can not be changed after death and should provide the peace of mind that your last wishes will be followed through to your loved ones.
Trust in Integrity Estate Planning
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Newport Beach, CA 92660