Living trusts are a popular component of many estate plans, as they allow you to control the property and assets in the trust until your death when they will be turned over to the trustee that you named. The trustee will then take care of distributing your property in line with your wishes. Because the assets are already in the trust, the process eliminates the tedious and expensive probate process. Here’s what you need to know about the truth behind the most common myths about living trusts.
Living Trusts Are Only Worth It If You Have Many Assets
While living trusts are a great tool for those with many assets to distribute, that does not mean that they are only appropriate for people with a lot to distribute. There are many benefits to living trusts that don’t go away if there is less to place in the trust.
Living Trusts Aren’t Beneficial For Anyone But the Beneficiaries
This is a common misconception about living trusts, and it ignores that trusts can also make things easier in the event that you are incapacitated. This makes it much simpler for loved ones to handle things if you are unable to do so.
You Can’t Change Your Living Trust Once It’s In Effect
As the name implies, a living trust is designed to live with you, so you can change aspects of the trust as needed as you age. You can take funds or assets out of the trust as you need to do so, or you can add more in. The trust makes sure that your assets don’t end up in the wrong place with someone you don’t want to have access to them and can change alongside you.
Living Trusts Are Expensive
While a living trust is often more of an investment to set up than writing a will, the cost and time savings later down the road often more than make up for the expenses in the long run.
Wills and Trusts Are the Same
A living will can do different things than a traditional will, which is why they are such an important part of estate planning. A living trust protects your money and property so that your assets will be there for your loved ones. They also allow you to attach conditions to the property you are leaving behind if you prefer your child reach a certain age.
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