Many estates can benefit from a living trust, but how do you know if one is right for you? Here are just five of the signs a living trust may benefit your estate plan:
1. You want property to avoid probate.
Probate is the legal process that settles an estate. In New York it takes place in Surrogate’s Court. The process is known to be time consuming and costly for larger estates. A living trust actually owns your property, therefore trust property avoids probate.
2. You want to give someone full authority to manage your assets if you become mentally disabled.
A living trust can appoint a successor trustee to take over if you become unable to manage your affairs. It works much like a power of attorney, but banks and title companies are much more willing to accept a trust and act on it.
3. You own real estate out of state.
During probate, title is transferred to the new owner. If you own real estate in another state, you must have a probate, called an ancillary probate, in that state as well to transfer ownership. It can be costly, so a living trust is preferable to allow out of state property to avoid ancillary probate.
4. You want to keep your estate private.
Probate takes place in court, which generates a public record. While a will is still needed to name an executor for an estate, or a guardian for children, the bulk of the property issues can be kept private.
5. Your will is likely to be challenged.
In practice, it is more difficult to challenge a living trust than to contest a will, particularly if the living trust was properly operated by the deceased for many years before their death.
If you would like to discuss how a living trust can fit into your estate plan, contact our office to see if this estate planning tool is right for your needs.