A revocable living trust is a legal document that allows you to transfer property and assets into a trust for your benefit during your lifetime. The trust is managed by trustees and can be modified or revoked at any time according to your wishes. It also helps you avoid the probate process after death, which can be lengthy and expensive. Let’s take a closer look at what revocable living trusts are, how they work, and why you may want to consider setting one up.
What Is a Revocable Living Trust?
A revocable living trust is an estate planning tool that allows you to place assets into a trust in order to keep them out of probate court upon your death. A revocable living trust is established while you are still alive, but it goes into effect upon your death. When you establish the trust, you name yourself as the grantor (creator of the trust) and trustee (manager of the trust). You also name beneficiaries who will receive the assets that were placed in the trust after your death.
How Does It Work?
When creating a revocable living trust, you must transfer all of your assets into the trust. This includes investments, real estate, personal property, etc. Once all of these items have been transferred into the trust, they become part of it and are no longer owned by you as an individual. Instead, they now belong to the trust itself and are managed by its trustees according to its terms. Upon your death, all of these assets will be distributed among your beneficiaries according to instructions set forth in the terms of the trust agreement.
A revocable living trusts is an important tool for estate planning that can help ensure that your wishes are carried out upon your death without having to go through probate court proceedings. It’s important to understand how these trusts work before deciding if one is right for you; however, if you do decide to create one, it can provide peace of mind knowing that all of your assets will be handled according to your wishes when you pass away. If this sounds like something that would benefit you or someone close to you, consider reaching out today!