A revocable living trust is often used as the backbone of a comprehensive estate plan. Individuals or couples often use living trusts to do everything that a will normally does, without many of the hassles that go with probating wills.
A revocable living trust is a written agreement that names a trustee to manage your property for the benefit of certain named beneficiaries. So long as you are mentally competent, such a trust may be amended or terminated at any time, although a revocable living trust generally becomes irrevocable (not changeable) upon the creator’s death. In the State of Wisconsin, a written trust agreement must explicitly state whether the trust was designed to be revocable. If the trust agreement does not expressly state that the trust may be revoked, it is normally deemed an irrevocable trust.
When you create a revocable living trust, you will select beneficiaries who will receive any income from the trust assets. They will also receive any property in the trust according to your direction. You must also select one or more trustees to manage the trust according to your written wishes. A trustee may be anyone you choose, as long as the person you select is a competent adult. Most individuals with a revocable living trust name themselves to serve as a trustee or co-trustee. Additionally, a spouse, friend, or other relative is frequently chosen to act as a backup (successor) trustee. Any trustee selected should be someone who is capable of properly managing and distributing the trust assets upon your death. It is also a good idea to select an alternate successor trustee to step in if the original successor trustee is not willing or is incapable of serving as a trustee.
Individuals or couples who create a revocable living trusts (known as “grantors”) will name themselves as the initial beneficiary. After the grantor or grantors die, the trust is normally distributed to their children, or other named beneficiaries, but sometimes the trust is kept in place for years to provide income for one or more beneficiaries while they are growing up, or while they are incapacitated.
A revocable living trust may be funded or unfunded. Once property is placed in the trust, it is funded. It is very important to fund a living trust if you want your heirs to get the most benefit from it. Sometimes people have revocable living trusts drafted, but do not fund the trusts during their lives. This sometimes triggers a probate at their death, and defeats the whole purpose of having the trust in the first place. We at Estate Law Partners, LLC, always ensure our clients’ trusts are fully funded, so probate is avoided and our clients’ heirs have a smooth transition in the end.
There are several benefits to using a revocable living trust as an estate planning tool. One benefit is that you may specify in the trust agreement exactly how you would like your assets to be managed in the event of an unexpected disability. Because of this, once a revocable living trust has been established, it may be used in lieu of a conservatorship or guardianship. Another benefit is that such a trust document allows you to provide financial resources and name guardians for your minor children. Additionally, a revocable living trust may speed up the distribution of your assets as such trusts are not subject to probate. Because of this, such a trust can provide time and expense savings and added confidentiality regarding your estate. If you are considering establishing a revocable living trust, it is a good idea to contact our experienced trust attorneys.
Contact Estate Law Partners, LLC, for all of your estate planning needs. Our experience trust attorneys are available to discuss your individual situation and create a comprehensive estate plan to protect the financial interests of your loved ones upon your death. Request an estate planning consultation with one of our experienced estate planning attorneys to start a dialog about the benefits of a revocable living trust.