People sometimes hear about “trust fund babies” and automatically assume that trusts are only useful for very wealthy people.
Those of us who have been able to accumulate a great deal of wealth throughout our lives can indeed benefit from the creation of a trust. However, a trust need not be funded with enough money to make the beneficiary independently wealthy throughout his or her life.
Trusts are actually viable options for people who are not extraordinarily well-off. Below are the top three reasons why people choose to create revocable living trusts when they learn all of the facts.
Timely Asset Transfers
The administration of your estate is supervised by the probate court when you arrange for asset distributions through the execution of a last will. The probate process can take a lot of time to run its course. The heirs don’t receive anything until the court has closed the estate.
With a revocable living trust you can arrange for the assets to be distributed to the beneficiaries outside of the probate process, enabling timely asset transfers.
As the grantor of a revocable living trust you retain control of the assets while you are living. You can act as the beneficiary and the trustee, and because the trust is revocable you can change the terms or dissolve the trust entirely.
A significant percentage of people become unable to make sound financial decisions when they reach an advanced age. When you create a revocable living trust you can name a disability trustee. This hand-picked decision-maker is empowered to administer the assets that have been placed into the trust in accordance with your wishes should you become incapacitated at some point in time.