Why Create A Living Trust?

A living trust is an important part of your estate plan. Making a living trust takes a more work than writing a will because a living trust requires that you take the additional step of transferring property into the trust. But like wills, living trusts are simple documents that do not require a lawyer’s blessing. Most people can create a living trust without an attorney using software or an online service.

The main reason to set up a living trust is to avoid probate. Probate is the process that courts use to distribute a deceased person’s property. Most people don’t need or want their estate to go through probate because it’s expensive and time consuming. Property that passes through a living trust does not have to go through probate. Instead, the person named in the trust to be the trustee distributes the deceased person’s property without court oversight. For many people with simple estates, this is far better than paying the court thousands of dollars and waiting months or years for the court to make the same distributions.


Keep in mind that not everyone needs a living trust. For example, if you don’t own a lot of property or if you plan to leave everything to your spouse, a simple will may serve you better. This is because many states have a quicker and easier probate process for small estates and for transfers to spouses.
In these cases, drafting a living trust and transferring property into the trust maybe more trouble than it’s worth.
 

Making your own living trust does not have to be complicated, though it may take a little work. Find quality self-help materials that will guide you through the process. There are books, software, and online programs that can help. Make sure the tool you use explains the process clearly in plain-English. It should guide you every step of the way. If you use a form from a book or downloaded from the Internet, you will need to fill in the blanks and choose which clauses to include. If you use software or an online program, you will go through an interview and the program will assemble the document for you. In either case, the result should be a clear legalese-free document that you understand completely.

After you have made the document itself, you must sign it in front of a notary public and transfer your property into the trust. A good self-help product will also help you through these critical steps. If the property isn’t properly transferred into the trust, the property will go through probate and it will not be distributed to the beneficiaries named in the trust. Transferring some kinds of property into the trust is easy – you just attach a list of the property to the trust. However, property with title documents –such as real estate – must be retiled in the name of the trust. If you have any questions about this, find a better self-help resource or see an attorney for guidance.

Don’t try to make your own living trust if you don’t have anyone to name as trustee. The person you name as trustee will have control over your property without any oversight from the court system. That person should be someone you trust completely. If there is no one you feel comfortable naming as trustee, you may want your property to go through probate instead. See a lawyer for advice.


Source:AllLaw.com

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