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Should You Create a Living Trust?

Filed under: Estate Planning

A will is one of the most useful and important estate planning tools you can create. However, a will can’t accomplish everything. While it does provide instructions on asset distribution and guardianship for children, there are other estate planning challenges a will can’t resolve.

For example, probate costs could drain your assets. Some of your heirs may not be competent enough to manage their inheritance. You could face incapacitation near the end of your life and become incapable of handling your own affairs.

You can address these issues and more with a living trust. Many people assume that trusts are only for those who have substantial wealth. However, the truth is that a trust can be helpful for anyone who wants to protect their assets and leave a legacy for their loved ones. Below is some basic information on living trusts and how you can use one to plan your estate:


What is a living trust?

A living trust is a legal document that provides specific instructions on how your assets should be managed and distributed. You create the document and then retitle assets so that they are owned by the trust. You then name a trustee, who oversees the assets inside the trust and the execution of the document. Once the document is created and the assets are retitled, all management of those assets must be done according to the trust’s instructions.

Most living trusts are revocable, which means you can change or even dissolve the trust. Many people name themselves as trustee. By naming yourself trustee, you can maintain control over the assets while you’re still alive. You would also name a successor trustee to take over management of the trust should you pass away or become incapacitated.


Are a will and living trust different?

While a living trust and a will both offer instruction on asset distribution, the trust offers far more control. With a living trust, you can specify not only who should receive specific assets, but also how and when you want the assets distributed. For example, you can state that the inheritance be paid out in annual installments or only after an heir has reached a certain age. This can be helpful if you have heirs who are minor children or who face challenges that would prevent them from using the money wisely.

A trust can also protect you if you face incapacitation later in life. Conditions such as Alzheimer’s, Parkinson’s and others could threaten your ability to manage your finances. If you suffer incapacitation, your successor trustee could assume control of your assets and make decisions on your behalf.

Finally, a trust can be helpful because it avoids probate, which is the legal process for settling one’s estate. A will doesn’t bypass probate, so your assets could be tied up in court for months following your death. Also, your estate could rack up sizable legal and administrative costs during the probate process. A trust minimizes delays and legal expenses.


Would you benefit from a living trust?

The decision on whether you need a living trust should be based on your own specific needs and goals. If you wish to have greater control over your legacy and offer enhanced protection to your heirs, however, a trust could be a wise idea.

Ready to discuss your estate planning strategy? Let’s talk about it. Contact us today at Ambrose Financial & Insurance Services. We can help you analyze your needs and develop a strategy. Let’s connect soon and start the conversation.


Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice.

16995 – 2017/9/25