Do you need a Living Trust?
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Do you need a Living Trust?
3 things to consider:
1) More privacy,
2) More control, and a
3) Quicker distribution to beneficiaries.
A Living Trust offers more Privacy.
Let's talk privacy. If you die without estate planning documents, your estate will be distributed through probate. Probate is a court process, meaning it is completely public. So even though you may not be famous or in the public eye, you still probably don't want anyone who's curious to be able to obtain that information. Having a Trust can avoid that.
You have more control with a Trust.
It also can give you more options than just a plain beneficiary form. So let's say you want to be more detailed and specific, and you've got young adults or minor children. You can still list them as a beneficiary, but you can list the amount, whether in percentage or dollar amount, that you want them to receive at certain ages. Having exceptions for medical care or education can also be written into there, so it just has more flexibility and more options that might fit your needs better.
A Trust offers a quicker distribution to your beneficiaries.
Probate, again, is a court process, and the length that it will take to complete and the cost varies per state. In some cases, it could take months, if not years, before the beneficiaries receive their assets. Having a Trust will be quicker and more efficient. So if that is also a goal of yours, then having a Trust makes sense.
A Trust is not the only way to avoid probate.
But of course, a Trust is not the only way to avoid probate. It doesn't make sense in every case. You might have a really simple situation where proper titling and completing the beneficiary forms can accomplish just what you need. So you do need to talk to your advisors just to make sure you're on the right path. I will also put a link to an article below about proper titling and you can reach out with any questions.
My name is Linda Rogers, Owner of Planning Within Reach.
originally published 12/8/2020
Linda Rogers, CFP®, EA, MSBA is the owner and founder of Planning Within Reach, LLC (PWR). Originally from New Jersey, Linda services clients throughout San Diego county and nationwide. She leads the design of PWR's investment portfolios which utilize broad, low-cost investments that integrate environmentally, socially, and governance (ESG) factors.
Planning Within Reach, LLC (PWR) is a fee-only and fiduciary wealth management firm offering one-time comprehensive financial planning, ongoing impact-focused investment management and tax preparation services in San Diego and nationwide. PWR is a woman-owned firm that specializes in busy professionals and impact investors. Planning Within Reach, LLC and their advisors do not receive commissions and do not hold any insurance licenses or brokerage relationships.