Did you know that your will and testament must go thrugh a probate process before it can be distributed? AND, the contents become public knowledge?
What happens is the will and testament must be validated first before any of your assets can be given to your designated heirs. This process can take between 9 months to two years! That means it could take up to 24 months for your heirs to receive their distributed assets. Basically, during this time period the assets are typically frozen, until the probate court has approved distrubution. As a realtor, I see this all the time, and it can be a nightmare!
Probate can be expensive too. Depending on the state you reside in, mandatory court costs and legal fees can range from 3% to 8% of your entire estate.
Did you also know that probate court proceedings are considered a matter of public record? This means anyone can know all about your estate, (what you own and what you owe), and who will be receiving your assets (and when). What can be terrible about this is that many scammers prey upon this information.
A Living Trust is a private legal document the provides specific instructions for how and when you want your assets to be distributed, PLUS this document helps to avoid public knowledge of your estate details. A Living Trust does not go through probate, like wills do. This is beneficial because it means your estate can be transferred directly to your heirs without the delays, public record of probate, and expenses that a will has.
Living Trusts can also do more for you and your heirs, than a will can. One example of this is that certain assests may remain in your trust until an heir reaches a particular age. This prevents court control of a minor's inheritance. Another example is if you have an heir with special needs, it can be set up for a lifetime of financial security. An additional example, if you have a situation where you may no longer be able to make decisions for youself, you may have a co-trustee who can assume that responsibility for you (based on your strict instructions). This helps because it bypasses the need for a court approved legal guardian.
When you set up a trust, you become the "trustee" of your assets, instead of the owner. Which means that legally your trust owns everything, but you own the trust. You continue to manage everything as you do now, except that you do it through the trust, as a trustee owner, not a titled owner. So you simply transfer title of your assets (home, car, bank account, investments, untitled items, etc) to your trust. I see this quite a bit with real estate investments. When real estate is set up in a trust, it is typically a much easier transfer, than those held up in probate court.
If a Living Trust sounds like it is a better fit for you, or you want to learn more, please reach out to me today. I am realtor who specializes in helping senior citizens transistion their living environments. I am NOT an attorney, however, I can put you in touch with my trusted partners to help go over Living Trusts in depth with you and answer all your questions, so you may make a decision on if a Living Trust is right for you.
Please contact me at: Mickie.Giacomini@gmail.com or 916.572-1117