As you begin the estate planning process, you may have concerns about your property passing through probate. This process can drag on for months, if not years. And your beneficiaries may fight and rack up fees that diminish your estate’s value. As an alternative, you may want to consider creating a revocable living trust, which bypasses the process.
How trusts bypass probate
When forming a revocable trust, you will transfer your assets to its ownership. While you are alive, the property in your trust belongs to it, not you. But you can serve as trustee and administer its contents. Because the trust is its own entity, it does not die with you. Since it is technically living, it can thus bypass probate court. Instead, the successor trustee you named will retain control over its assets. They will then disburse the trust in the manner which you designate in its record, to the beneficiaries that you named.
How trusts are established
Creating a trust is more expensive than drafting a will. But factor in the probate process, and the trust keeps more of your estate intact in the long run. Setting up a trust is fairly simple, too. You will start by drafting a trust agreement which establishes its terms. This agreement involves the trust maker, the trustee and the beneficiary. And you can serve in all three roles when creating it, so long as there are other beneficiaries named in the process. Once you write the agreement and have proper documentation of the trust’s assets, you will need to have it notarized for it to become official.
A revocable living trust is a worthwhile arrangement for safeguarding your assets. Your beneficiaries will be grateful, too, that you saved them the time, costs and headaches of battling in probate court. An attorney with estate planning experience can walk you through the process of creating yours.