Estate Planning, Probate and Trust Administration
What is a Living Trust?
A trust is an arrangement under which one person, called a trustee, holds legal title to property for another person, called a beneficiary. You can be the trustee of your own living trust, keeping full control over all property held in trust.
A “living trust” (also called an “inter vivos” trust) is simply creating a trust while you’re alive, rather than one that is created at your death.
Why Should I Make a Living Trust?
The big advantage to making a living trust is that property left through the trust doesn’t have to go through probate court. In a nutshell, probate is the court-supervised process of paying your debts and distributing your property to the people at who inherit it.
If I Make a Living Trust, Do I Still Need a Will?
Yes, you do – and here’s why:
Writing a will and testament is an essential back-up device for property that you don’t transfer to yourself as trustee. For example, if you acquire property shortly before you die, you may not think to transfer ownership of it to your trust – which means that it won’t pass under the terms of the trust document. But in your will, you can include a clause that names someone to get all of the property that you haven’t left to a specific beneficiary, such as a will executor.
If you don’t have a legal will, any property that isn’t transferred by your living trust or other probate-avoidance device (such as joint tenancy) will go to your closest relatives in an order determined by state law. These laws may not distribute property in the way you would have chosen.