A living trust is given the designation of “living” because it is created while the trust creator is alive. Living trusts begin before death, they may be used during the creator’s lifetime to manage their assets and establish inheritance plans for how the trust assets will be distributed at the time of the creator’s death.
A person may create a living trust by placing items of real and personal property into it during their life. The creator may serve as the trustee of the living trust, which means that they may manage its operations and decide how the trust will be administered. Since a person may want to change their mind regarding what is contained in a trust and how it is organized, they may designate it as a “revocable” living trust, which means that it can be terminated by the creator.
A valid revocable living trust that is in existence when a person passes away may help avoid many of the pitfalls that are associated with probate. Since the decedent does not technically own their property, as it is in the name of the trust, they will have little in their end-of-life estate that needs to be evaluated by the probate court. More benefits exist to executing living trusts that readers may wish to discuss with their estate planning attorneys.
Creating a revocable living trust requires a creator to follow certain legal parameters. Although they can be of great value, living trusts should be established with the help of legal professionals who know the importance of setting them up the right way.