Safeguarding Your Financial Future and the Future of Your Loved Ones with the Revocable Living Trust Estate Planning Tool

While a last will and testament may be the foundation upon which virtually all estate plans are constructed, that does not mean that’s where your estate planning should end. Depending on your circumstances, there may be various estate planning measures available that could protect your interests, including helping you or loved ones secure public benefits, ease the burden of critical medical decisions, protect assets from creditors, and more. One estate planning option worth considering for individuals and families is creating a living trust, whether revocable or irrevocable.

Well-prepared trusts can protect your interests, help you achieve your goals, and potentially preserve the value of your estate while passing assets to beneficiaries and heirs. Unlike other estate planning tools, such as wills, which only go into effect at the time of death, a living trust can benefit you and your loved ones throughout your lifetime.

How Do Revocable Living Trusts Work?

There are two main types of living trusts available in New York estate plans: revocable and irrevocable living trusts.

Revocable living trusts are the more common and flexible of the two main categories of living trusts. These documents allow the creator of the trust to modify or terminate it at any time before their death, giving them complete control over how trust assets are managed and distributed. The creator of the trust and any trustee can also add more assets to the trust, alter designated beneficiaries, sell trust assets, and make virtually any other changes they may desire. At the time of their death, the trust becomes irrevocable, at which point trust assets will pass along to any named beneficiaries.

What Are Some of the Differences Between Revocable and Irrevocable Trusts?

Unlike a revocable living trust, which can be easily changed or revoked at virtually any time, an irrevocable trust cannot be easily amended or terminated.

While revocable living trusts have many benefits, they do not provide the same relief from estate taxes or shield all assets from creditors and claims against the estate. Those with large estates may consider the benefits of creating an irrevocable living trust, which protects assets from certain tax liabilities and provides other benefits that revocable trusts do not. However, irrevocable trusts are not easily changed, and the individual who creates the trust does not have direct control over how the trust assets are spent or distributed. If your primary goal is flexibility and ownership over trust assets, a revocable living trust should be your choice. To learn more and determine which type of living trust is most suitable for your goals, please address your questions and concerns during your free case review with our law office.

Is a Living Trust the Same Thing as a Living Will?

Living trusts share many similarities with living wills, but they are not the same type of document. The living will is an estate planning document that grants an individual power of attorney and the right to make confident decisions on your behalf, such as if you are ever left incapacitated or severely disabled and unable to speak for yourself. We generally recommend that our clients consider developing both living trusts and living wills as part of a comprehensive estate plan. Still, it’s critical to understand that these documents are not the same.

What Are the Benefits of Creating a Revocable Living Trust?

There are a variety of factors that make revocable living trusts incredibly beneficial estate planning tools for you and your loved ones, both in the short term and in the long term.

Among the many benefits of including revocable living trusts in your estate plans are the following:

• The ability to change the way the trust distributes assets and to whom
• Authority to change the basic terms of the trust document and how it operates
• The power to change which assets are included in the trust
• Ability to change the trustee at any time of your choosing
• Full ability to change where the trust is located
• As the term ‘revocable’ suggests, the trust can be revoked at any time
• You can add or remove beneficiaries who stand to enjoy the benefits of trust assets
• Different trustees can be designated for different parts of the trust and for other functions, and you can also designate successor trustees
• And more

What Are Some of the Misconceptions of Living Trusts?

While many people understand that revocable living trusts and other trust documents play vital roles in comprehensive estate plans, some decide not to include a living trust because of preconceived notions that such a document is not necessary to meet their goals.

Some of the many misconceptions that people have about revocable living trusts include the following:

• Just because you have a last will does not mean you would not benefit from a revocable living trust as well. Ultimately, these documents serve very different purposes, and we assure you that it is wise to prepare yourself and your finances for what may happen today and in the future by creating both documents.
• Some believe that trusts do not benefit themselves, but rather only their beneficiaries or heirs. Revocable living trusts and other estate planning measures can indeed benefit your interests, such as helping you avoid probate, guardianship proceedings, and making things easier for yourself and others if you’re ever left incapacitated.
• Just because you are putting assets into the living trust does not mean you are losing access to them. With a revocable living trust, you maintain ownership over trust assets, giving you the benefit of accessing those assets at virtually any time.
• There is a common belief that trusts are reserved only for the wealthy and those with large estates, but this is not true. While it is correct that specific individuals and families may stand to benefit from living trusts more than others, revocable living trusts have several uses for all financial situations and family dynamics.
• It doesn’t have to cost a lot to create a trust. Although establishing a trust usually costs more than drafting a last will, these costs can be offset by avoiding probate proceedings and other legal issues.

Contact Our New York Law Firm to Schedule Your Free Consultation with Our Experienced Attorneys Today

There are many considerations and complexities inherent in creating a valid trust that meets your needs, so we must encourage all interested parties to choose a legal practice with extensive experience handling such matters to ensure proper guidance throughout the process. At our New York law firm, we provide compassionate legal services to clients in and out of court and help develop estate planning documents that make their lives easier today and into tomorrow. To learn more about the benefits of retaining our professional legal counsel, please get in touch with our firm to schedule your free 30-minute case evaluation today.

If you are considering creating a revocable living trust, we encourage you to speak with our legal team in your no-obligation case evaluation. Together, we will determine which type of trust best suits your needs and help develop a plan to secure your special goals.

Call us today at 845-682-5572.