Ask Nancy…

Willby Nancy Burner, Esq. & Kimberly Trueman, Esq

Question: My friend just created a Revocable Living Trust and I am not sure if I should be considering creating one as well. I am in my sixties and have an estate worth approximately $800,000.00. My current Last Will and Testament disinherits my estranged son. Is a Revocable Trust something I should consider?
Answer: A Revocable Living Trust is a trust that you create during your lifetime and is great tool for those who wish to avoid the probate process. A Revocable Trust is designed to give you, as the grantor (creator) great flexibility. With a Revocable Trust, you may act as your own trustee. This allows you to maintain complete control over your assets during your lifetime.
With a Revocable trust, assets can be freely transferred in and out of the trust. You can also change or revoke the trust at any time and make all decisions regarding the Trust. Assets commonly transferred into these trusts include residences and investments such as bank accounts, certificates of deposit, stocks and bonds.
In the event of your incapacity, a Revocable Trust can provide for a seamless transition for the management of your affairs. The person(s) you have selected as successor or co-trustee would simply take over the management of those assets titled in the name of the trust, possibly avoiding the need for a Property Management Guardian.
Even though the initial cost to create a Revocable Trust may be more than the cost of executing a Last Will and Testament, spending the money to do a trust now may save your family money in the long run since trusts avoid the probate process. Probate is the process wherein a Last Will and Testament is admitted to Surrogate’s Court. Like any court process, it costs money and can delay the process if an heir is being disinherited. Should probate be required in order to administer your estate, even though you have chosen to disinherit him, your son will be given notice of the proceeding and an opportunity to challenge your will. Although your wishes may still be upheld, navigating through the process can be costly and time consuming, resulting in a smaller inheritance and delay for your intended beneficiaries. With a trust, unlike a probate proceeding, there is no notification required when a trust is administered. Your trustee can simply distribute the assets as you have set forth in the trust agreement.
When considering your estate planning, it is important to note that, a Revocable Living Trust does not protect your assets for purposes of Medicaid eligibility. How to best structure your individual estate plan is an important and personal decision, which you should discuss with your estate planning attorney before making any final decisions.

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