When you think of estate planning, you hopefully have a will to direct who receives your property after your passing. However, if you want to begin setting aside funds for a specific individual or organization, a living trust can be a better option to ensure your assets get to the proper party.
We know this can be complicated, so to help you get started, our estate planning attorneys in Raleigh are sharing what you need to know about a living trust.
What Is a Living Trust?
A living trust is a legal document in which you name property and assets that are designated for a specific individual or organization after you die. There are three people involved in the trust:
- Grantor – The person who creates the trust (you).
- Beneficiary – Individual or organization who receives assets or property from the trust.
- Trustee – Individual or board who takes on ownership of the trust to manage it according to the grantor’s wishes and to the benefit of the beneficiaries.
Because it’s a living trust, you’re able to act as both grantor and trustee and take complete control over it, adding to or taking assets out of it, until you pass away. However, you will need to select a successor trustee to take over after you are gone, just like you name an executor of your will.
What Can Go Into a Living Trust?
Anything with financial or monetary value can be placed into a trust:
- Property, including real estate
How Does a Living Trust Differ from a Will?
A living revocable trust and a will are very similar, especially after you pass away. A successor trustee handles the trust exactly as you’ve laid out in the instructions, just as an executor handles the will in the way you’ve laid out.
There are two key differences:
- A will may have to go through a lengthy and expensive court process called probate before any of the assets or property are distributed to your heirs while a trust is completely private and goes directly from you to the trustee who can distribute it
- A trust is for highly valuable items like real estate and stocks. Wills address anything you want to leave to someone else, including furniture, clothing, or keepsakes as well as where you appoint a guardian for your children and address funeral wishes
Benefits of a Living Trust
Creating a living trust offers three key benefits over only relying on a will:
- As we mentioned above, leaving your loved ones’ inheritance in a trust allows them to skip probate
- You can keep your assets private, unlike a will which may go through a public probate
- You can more easily care for both your partner and your children. You and your spouse can create a joint living trust where when you pass away, your spouse becomes the trustee and grantor. When they pass on, the trust can be passed to children or other heirs or beneficiaries
- Protect and care for minor children by placing their funds in a trust that the trustee can manage and distribute until the child reaches a set age
Schedule a Consultation with an Estate Planning Attorney Today
Whether you already have a will and would like to continue your estate planning with a living trust or begin the process, we can help. Schedule a consultation with an experienced attorney today who will walk you through the process and ensure your assets are in good hands both today and after you’re gone. Call our Raleigh office at 919-615-2473, our Wendell office at 919-365-6000, or fill out the form below.
Protecting your Privacy ~ Your privacy is our primary concern. At Kirk, Kirk, Howell, Cutler & Thomas, LLP., we understand the importance of protecting your privacy and will never share your contact information with a 3rd party. Contacting our law firm does not imply any form of attorney-client relationship.
Information presented on this website should not be construed as formal legal advice or the formation of an attorney-client relationship. Additionally, any email sent to Kirk, Kirk, Howell, Cutler & Thomas, L.L.P. or any of its lawyers at the email addresses set forth in this website will not create an attorney-client relationship.
Wills & Estates - Case Review