Choosing to create a living trust as part of your comprehensive estate plan is a very personal decision derived from your specific circumstances. There are some general reasons that apply universally that may drive this decision. Below are the top 5 reasons clients choose to create a living trust:
1. Bypass Probate. This may be one of the biggest factors when considering whether or not to include a living trust in your estate plan. Probate can be a hassle for your loved ones during their grief stages. Dealing with paperwork, inventories, creditors and delays come with the probate territory. A living trust does not go through the probate process and allows your heirs to immediately benefit from assets held in the trust.
2. Privacy. Probate is a public process. The information filed in the courthouse can be searched and accessed by anyone who takes the time to look. This includes the inventory of assets showing the net worth of the decedent, including all liabilities. Many people want to avoid having their financial issues available for public viewing after death and this reason alone drives many clients to create a living trust. A living trust does not need to be filed with the probate court so only the parties named in the trust – the trustee, beneficiaries and attorneys- are privy to the information about the trust terms and the assets that fund the trust.
3. Reduce Taxes. In certain circumstances, a living trust can help minimize estate taxes and protect assets from creditors or ex-spouses during a divorce. They are often used as an asset protection strategy.
4. Simplification. Keeping your affairs straight-forward and simple can be accomplished better by a living trust than a will that goes through probate. It also shows compassion to your loved ones by ensuring that they do not have to deal with a lot of post-mortem hassles.
5. Creative Terms. A living trust can be constructed in many creative ways to slow down the distribution of assets to heirs, create payment schedules, require certain conditions to inherit and much more. An experienced estate planning attorney will be well-versed in all the numerous terms and conditions that can be included to accomplish all types of goals.
Contact Stouffer Legal in the Greater Baltimore area to start a conversation about how a living trust may be beneficial for your needs. We tailor each living trust carefully and can brainstorm many different types of terms that should be included. You can schedule an appointment by calling us at (443) 470-3599 or emailing us at office@stoufferlegal.com.
