Some people never consider the utilization of a revocable living trust, because they do not understand all of the facts. They do not consider themselves to be wealthy, and they think that trusts are only for high net worth individuals.
In fact, a revocable living trust can be a good choice for you even if you are not wealthy.
These trusts facilitate smooth and efficient postmortem asset transfers, because the trustee that you name in the trust agreement can distribute assets outside of the probate process.
Probate is a legal process, and it comes into play when you use a last will to transfer your personally held property. After your passing, the executor or personal representative would be required to admit the will to probate. During the probate process, the Surrogate’s Court would supervise the administration of the estate.
This process provides oversight, but it can make things a bit difficult for the inheritors. Probate does not run its course overnight. In New York, a simple and straightforward case can be probated in nine months to a year. The people who are waiting for inheritances will not receive their bequests during this time.
Expenses are another consideration. There are costs that present themselves during probate, and these expenditures reduce the value of the estate.
If you were to convey assets into a revocable living trust, you could act as the trustee and the beneficiary while you are alive. You create a trust agreement, and in this agreement you name a successor trustee and successor beneficiaries.
After you die, the successor trustee would follow your instructions. Assets would be distributed to the successor beneficiaries in accordance with your wishes. If you want to, you can instruct the trustee to distribute some of the assets on an incremental basis so the beneficiaries would receive income over an extended period of time.
These distributions would not be subject to the probate process, so in many cases, the trustee could start distributing assets shortly after your passing.
Funding a Revocable Living Trust
You fund a revocable living trust with assets that will be distributed to the beneficiaries. To fund the trust, you list the assets that you are conveying into the trust in the trust declaration. Another option would be to list the assets on a separate document called a schedule.
In addition to this, you must change the title of the property that you are conveying into the trust. You make the trust the owner of the property.
If you would like to obtain more detailed information about revocable living trusts, download our special report. The report is free, and you can get your copy through this page: Smithtown NY Living Trust Report.