Living Revocable Trusts

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Advantages of the Living Revocable Trust

Avoids Probate
The use of this estate planning device helps avoid the cost associated with probate. It also helps to avoid the delay and publicity associated with the probate process. In addition, placing your real estate in a Living Revocable Trust also avoids probate in each state where you own real property.
Avoids Guardianship
The Living Revocable Trust avoids guardianship (conservatorship,) in the event of physical or mental incapacity. If you should become incompetent for any reason, the written provisions of the Living Revocable Trust have already provided for appointed backups so you will not have to go through probate court in order for a guardian to be appointed.
Flexible
The Living Revocable Trust is completely flexible. You can change or cancel it at any time depending on your financial situation or changes in your family relations. One of the most attractive features of a Living Revocable Trust is that it provides the most efficient and effective estate planning process that is not carved in stone. You can change it as circumstances warrant simply by amending it. You do this by amending the entire Trust document or just one particular section, as needed. Normally, minor amendments are much less expensive than the cost of obtaining a new Will.
Preserves Privacy
A Living Revocable Trust preserves privacy. In contrast, the probate process makes all of your assets, your Will and all your family matters, financial and personal, open to the public. For $1.00 per page, anyone can obtain a copy of your Will and inventory listing all of your estate assets. By using a Living Revocable Trust, all of your family matters are kept private and confidential.
Hard to Contest
A Living Revocable Trust is very hard to contest as compared with a Will. Approximately 30% of all contested Wills are successfully contested. Very few Living Revocable Trusts have been successfully contested (See Florida Statutes 732.212, 732.206 and 732.207, Appendix to Chapter 5.) The difference is that contestability arises because a Will is created under testamentary laws, while a Trust is created under the laws of contract. Also, if you create a Will, it is created at a single moment in time. A Trust, however, is not only created, but it is used on a regular and ongoing basis. Courts have ruled that if you use an instrument such as Trust then you are presumed to know the contents of it. On the other hand, it is often difficult to prove that you know what is in a Will that you created twenty years ago and have not looked at since the day you signed it.
A Living Revocable Trust Takes less Time than Probate
A key problem with probate is the fact that it usually takes a long time. With a Living Revocable Trust, disposition can proceed very quickly and efficiently compared with a probate estate. However, certain assets such as real estate may take time to dispose of and therefore lengthen the Living Trust settlement process.
Emotional Factor
Another negative element of probate arises because the process is controlled by someone other than yourself. A judge, an attorney, and the probate court system all become involved, and you lose control. The emotional stress on your family resulting from this process can be devastating. With a Living Revocable Trust you are in control of the process. There are certain formalities and requirements that must be met to close or settle a Living Trust estate. However, a family who has set up a Living Revocable Trust is in the driver's seat.
Avoids Problems of Joint Ownership
One way to avoid probate is through jointly owning property with someone else. If it is titled properly with joint right of survivorship, the surviving owner of the property will own the entire parcel without going through the probate process. This method of avoiding probate is potentially hazardous and can leave heirs to face many problems. Owning property through a Living Revocable Trust accomplishes the same thing yet avoids all the problems associated with joint ownership of property.
Inexpensive to Set-Up and Maintain
A Living Revocable Trust is generally inexpensive to set up and inexpensive to maintain. There are no monthly or yearly fees to pay in order to maintain your Living Revocable Trust. Any changes that are needed can be made through amendments to the Trust. The amendments can be one paragraph, one page or the entire Trust document. Normally, amendments cost between $50 and $150 depending on the nature of the amendment. Obviously, if you are amending the entire Trust document, the cost may be greater.
Easy Disposition of Personal Property
Most Trust documents provide for the identification of a last writing. This last writing enables the creator of the Trust to leave a separate list of personal items to be left to specified beneficiaries. For example, one could leave a list of household items including, for example, a crystal vase or baseball card collection and then identify specific people, such as "my daughter Susie" or "my grandson Joey," to receive those items. The last dated and signed writing found with the Trust will dispose of all personal property identified in the writing. You can amend and change this writing every day if you choose to do so, without having to change the actual wording of the Trust document. Obviously, having a Trust set up in this way provides a tremendous amount of flexibility.
Prenuptial Protection
Another little known benefit of the Living Revocable Trust is that it provides one of the best prenuptial agreements available. A prenuptial agreement is simply an agreement between two people who plan to marry. It identifies the assets and generally says, "what's mine is mine and what's yours is yours" and under no circumstances, including divorce or death, shall a spouse get any of the other's assets. Unfortunately, it seems whenever the prenuptial agreement is most needed, there is always some lawyer who can find a loophole and circumvent the intention of the agreement. If a Living Revocable Trust is drafted before the marriage and the assets are kept in the Trust, it acts as a super prenuptial agreement that is virtually unbreakable.
Control After Death
The use of a Living Revocable Trust allows you to control your estate after your death. A Will only exists for a specified period of time, until all the assets and titles have been transferred. Once the transfers are made, the Will ceases to have any control. The problem occurs because the transfers are made to everyone named in the Will. Even if a person named in the Will is incompetent or unable to handle the money responsibly they must still receive their share. For example, a Will may say that assets go to son Tommy. However, Tommy may be two years old at the time of the testator's death. If this occurs, a guardianship estate will be created to manage the funds for Tommy until he reaches the age of 18 years. Upon Tommy's 18th birthday, he will receive all of the money in the account; this may be $10,000 or it may be $10,000,000. Understandably, no one with a sizeable estate would want a large sum of money turned over to a child upon his or her 18th birthday.

One of the goals of a Trust is to provide that minor children do not receive control of their inheritance until they are 25, 30, 35 or another age you select. This enables the minor child to receive all the necessary financial help from the Trustee. The Trustee can provide for all of the child's needs through college and postgraduate school without leaving the child in complete control of the money when he or she turns 18. Further, if a minor child or other beneficiary were to become incompetent for any reason, the funds could continue to be held in trust until the incompetent person either becomes competent or passes away. The Trust provides life-long guardianship avoidance for not only the original creators of the Trust but also all the beneficiaries of the Trust as well.