Estate planning is something individuals do to ensure their finances, assets, and legacy is secured for the future. It ensures there's little hassle for your beneficiaries in upholding your end-of-life wishes. One way that California residents can prepare for the future is to get a revocable living trust in place.
Revocable estate plans or trusts are an essential part of an overall estate plan and are something worth looking into early on. An experienced estate planning attorney can help you with the important considerations for your living trust.
What Is a Revocable Living Trust?
A revocable trust is established through a written declaration or agreement that appoints a trustee to preserve and manage your assets in the event you become incapacitated or die. You can put a revocable living trust in place as long as you're still a competent adult. Essentially, the trust acts as a rulebook for how you would like your assets handled in the event of your death.
Why Revocable Estate Plans or Trusts Are Important
Disability and death are two topics that most individuals would rather not talk about in too much detail. However, even though these topics can make you uncomfortable, it's important that you get an estate plan established ahead of time to ensure that the ones you love are provided for in the event of your incapacitation or death. While there are various tools at your disposal for comprehensive estate planning, like a last will and testament, getting a revocable living trust is one such tool.
A will won't go into effect until you die, whereas a living trust can take effect while you're still living and after your passing. And, you won't need to visit probate court since the assets you place inside your trust will automatically be transferred to those you've already designated as beneficiaries in the event of your death. Also, should you become incapacitated, your successor trustee will manage your trust assets, which is another benefit of revocable estate planning ahead of time. You can alter or cancel the trust's provisions at any time as well with a revocable trust, as opposed to an irrevocable one.
When Will Your Living Trust Become Effective?
Once you properly sign your trust document along with any other ancillary documents associated with your revocable estate plans, it becomes effective. You'll need to retitle your assets in the trustee's name to receive the most benefits of the trust. Your lawyer can assist you with this. If you don't have this part accomplished, those assets that aren't placed in the living trust prior to your death might end up having to go through the probate process first before they can go under the control of your trust.
Does your Living Trust Replace a Living Will?
A properly drafted and funded revocable estate plan will replace a will. But, you should include a special will referred to as a "pour-over" will as part of your revocable estate planning. While this might not be required if you don't have minor children and your trust is fully funded, it's an essential fail-safe tool in the event you fail to place all your assets into your trust. With a pour-over will in place, any assets that aren't included in your living trust at the time of your death will be "poured" into your trust so the provisions of the trust can control them.
Property subject to the pour-over may also need to be probated, depending on the type of property it is and how much it is valued. To avoid probate and the use of a pour-over will, you'll need to ensure you place all of your assets into your revocable living trust.
Reach Out For Help With your Revocable Living Trust
Estate planning is important, and one essential step you should take to protect your assets and financial legacy is to look into a revocable living trust. Our experienced attorneys here at the Law Offices of James C. Shields are here to assist you in setting your trust up and answering any questions you may have. Contact us today to schedule your free consultation.