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Revocable Living Trust or a Will, Which Really "WORKS" For You?


By Bob Hamilton
General Manager, CSFEWBC

A Will and a Revocable Living Trust are both legal documents prepared by lawyers. Both are part of the Estate Planning process. Both can be amended or changed. Both provide instruction on the distribution of your Estate after your death. But it's the differences, and there are many, that can affect you and your family.

If you have prepared a Will you have done some Estate Planning. But a Will falls short in many important areas. A Will does nothing for you or your family until after your death. A Will provides instruction to the Probate Court on how to distribute your Estate after going through the Probate process. Probate is a costly process in both time and money. There are costs, often over $1,000, for filing fees, appraisals fees, publishing fees; plus statutory fees for the Administrator and Attorney ($14,000 on the first $200,000 of gross value) that are paid for by the Estate. It often takes over two years to complete Probate which means your loved ones must wait for what is rightfully theirs. And because the Probate Court is involved all files are public record.

With a Revocable Living Trust the Probate Process is avoided completely

One of the best ways to avoid this time consuming, costly process is to establish a Revocable Living Trust. This ensures your financial affairs are secure, your privacy is maintained and your family will not be subjected to the Probate Process. Unnecessary legal fees and estate taxes can be reduced or eliminated. If all of your assets that would be subjected to Probate are identified as Trust assets your Trustee can transfer them quickly, efficiently and privately, without involving the Court on your death or the death of a surviving spouse.

Control and protection during your lifetime and after

Unlike a Will a Revocable Living Trust works for you during your lifetime and for your heirs after your death. With a Revocable Living Trust during your lifetime:

  • You are in complete control of all assets in the Trust, as the Trustee
  • You choose your Successor Trustee
  • If you become incapacitated your Successor Trustee will manage your assets;

With proper Estate Planning and use of a Revocable Living Trust provisions can be made for guardianship of your minor children. Provisions can be made for dependants with special needs to ensure they are cared for as you had planned. If you become incapacitated your Successor Trustee can step in and make sure you, your minor children and dependents with special needs are cared for.

Unable to handle your own affairs

Think about what would happen if you had a stroke, an accident, or for any other reason became incapacitated and weren't able to make decisions for yourself. Who would take care of your finances or make your healthcare decisions? If you don't' take the proper steps now, it could be up to the Probate Court through a process called Conservatorship. Through the use of a Revocable Living Trust that includes a Durable Power of Attorney for Asset Management and a Durable Power of Attorney for Healthcare you can avoid Conservatorship. In the event of your incapacity your Successor Trustee will manage the assets in your Trust. Your agent named in your Durable Power of Attorney for Asset Management, the same person as your Successor Trustee, will manage your assets outside of your trust and your agent on your Durable Power of Attorney for Healthcare will make medical decisions for you, if you are not able.

A Revocable Living Trust works for you

The major advantages of preparing a Revocable Living Trust over just a Will are:

  • Keeping the Courts out of your affairs before and after death
  • No Conservatorship on incapacity
  • No Probate on death
  • Avoiding or reducing estate taxes
  • Maintaining your privacy

This flexible legal document allows you to make important decisions for yourself and your family, now. The ability to amend it at any time, to reflect the changes in life situations, ensures no unintended disinheriting of your children and/or grandchildren can occur. It also prevents disasters that can be caused with joint ownership of real property. Preparing a Will is good, but in the end it will cost your loved ones time, grief and money.

For more information on preparing your Revocable Living Trust contact our friends at Liberty Trust Preparation, a CSFA endorsed provider. Liberty Trust Preparation has been in the business of helping you protect your estate since 1986. Contact them today, for a free consultation. Liberty Trust Preparation will explain these and other important benefits of a Revocable Living Trust and the peace-of-mind it will provide to you and your heirs. You can reach Liberty Trust at (800) 922-7764 or (949) 752-7479. You can also download the Living Trust brochure here.