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Could a living revocable trust be right for your estate plan?

Our law firm focuses on estate planning. One of the tools that we recommend to many clients is a living revocable trust. This type of trust offers many benefits, including the avoidance of probate. Best of all, the creator/owner of the trust can change his or her mind at any time, without consequences. A simple document, indicating a restatement of trust, can make those changes happen.

With a living revocable trust, any assets that have been transferred to the trust are under the owner's control, as trustee, and can be used only for his or her benefit, as beneficiary. After the owner's passing, a successor trustee will sign over legal title to the successor beneficiaries without having to involve the court or a probate procedure.

If you have taken the trouble of creating a living revocable trust, make sure that you have consulted with an attorney who focuses on estate planning. There may be state-specific procedures that must be met before the trust is valid. Our estate planning law firm can help you in this task.

At a minimum, a living revocable trust will not be valid unless it is funded. Said another way, a document that sets up a living revocable trust will function as nothing more than a piece of paper until assets are transferred to the trust. That means that the title to various assets must be changed from an individual's name to the trustee's. Admittedly, the same individual is both the trustor and the trustee in a living revocable trust (as well as the beneficiary). However, an asset's title should reflect that the trustee is holding it for the named trust.

Source: Wealth Management, "Facilitating Life Settlements," Jeff Hallman and Scott Thomas, July 25, 2016

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Bebout, Potere, Cox & Bennion, P.C.
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Rochester, MI 48307

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