Common Misunderstanding of Living Trusts
Most people have heard about living trusts but don’t quite understand how they work, which can lead to misconceptions about what they can and can’t do. If you’ve been looking into creating an estate plan, you should heavily consider placing some of your assets into a living trust. Before you do so, there are a few misconceptions about trusts that should be cleared up.
Living Trusts Are Costly
While a properly drafted trust will likely cost more than a will, these costs will likely end up being lower than the ones associated with a will since your assets won’t be taken through probate. The benefits associated with a living trust typically make it the preferred option even with the higher initial costs.
Trusts Require Giving Up Control Over Assets
While you can always choose a third-party to be the trustee for your estate, most people choose to be their own trustee, which allows them to control their assets in the same manner as they did before the assets were placed into a trust. Even if someone else is named as trustee, you can always replace them later if you want to take back control of your assets. Trustees must also follow the instructions that were initially placed into the trust. If they don’t, they can be held legally liable.
Living Trusts Aren’t Helpful for Avoiding Probate
Many people falsely believe that most of their assets will still be taken through the probate process even after placing these assets into a living trust, which makes them feel that investing into a trust is a waste of money. However, if the trust is prepared and put together by a reputable trust administration lawyer in Las Vegas, most of your assets will not be taken through probate. When using a living trust, there are only a few scenarios where some of your assets would go through probate before being distributed to beneficiaries. These scenarios include not transferring all your assets into the trust, the trust not being written well, and not having a revocable living trust.