Creating a living trust through an experienced estate planning attorney allows maximum control over trust assets during a lifetime. Planning for succession with a revocable living trust will protect assets in case of physical or mental incapacity due to age or illness. Appointing a successor trustee early will assure that assets are managed according to plans for beneficiaries.
What is a Living Trust?
A trust is a written legal document that allows assets to be transferred to designated beneficiaries upon death. With a living trust, assets such as homes, bank accounts, savings accounts, stocks and bonds, and other valuable possessions can be transferred into the trust. Most people name themselves as the initial trustee in charge of managing trust assets. Even though assets are transferred into the living trust, the initial trustee will remain in control of assets during his/her lifetime. With an estate planning attorney, a successor trustee can be named to manage the assets and distribute them upon the initial trustee’s death, or in the case of diminished physical or mental capacity. A revocable living trust can be amended or revoked at any time by the person or persons who created it.
Who Should Have a Living Trust?
Any estate with assets over $100,000 or an estate with real property over $20,000 should consider a revocable living trust. Even individuals whose estate is below those amounts may have reasons to create a living trust. Revocable trusts are not only effective after death, but they have attributes that are important before death. Important documents that are included in a trust package that deal with incapacity are critical in the event of a medical emergency or long-term illness that creates immediate need for a trusted successor trustee.
What are the Benefits?
The major benefit of a revocable living trust is to avoid probate which can be very expensive with statutory fees. Probate can reduce the amount of the estate that’s intended to pass to beneficiaries. With a living trust, there is usually no supervision of the trust by the probate court and no court costs. A trust is not filed or recorded, so it is much more private than a will. With an estate planning attorney who understands Illinois laws, a successor trustee can be established to avoid a court-supervised conservatorship in the event of incapacity of the initial trustee.