Even if you don’t have a mansion, a yacht, and a hefty bank account, living trusts can be an effective and necessary part of any estate plan. Living trusts are legal agreements that place your assets in a trust and then define who will inherit the trust when you either become incapacitated or die. When this occurs, the trustee you select will disperse your assets to your beneficiaries or manage them according to your wishes.
There are three separate types of living trusts: revocable, irrevocable, and specialized. A revocable trust can be changed or revoked any time during your lifetime, while an irrevocable trust cannot be altered or rescinded after your death. Specialized living trusts are for unique circumstances, like if you wanted to set up a charitable trust to send assets to a foundation, for example.
Wills are very similar to living trusts, but there are a variety of differences between the two documents. For example, wills only go into effect after you die, but a living trust can go into effect immediately after you sign it. Wills also have to undergo the probate process, but living trusts do not.
There are many benefits of living trusts, like keeping your matters private and helping your beneficiaries avoid probate, but they are not for every estate plan. Find out more about these documents and how they work by turning to us at TriCity Lawyers for legal guidance.