A Last Will and Testament (Will) and Revocable Living Trust (Living Trust) are both estate planning documents used to pass assets on to your beneficiaries at your death. Typically, for an estate planning attorney to create a proper Living Trust, the cost is more than to prepare a Will. When debating whether you should utilize a Living Trust as a tool in your estate plan, do not let the initial cost be the deciding factor. To help you make an informed decision, the information below discusses the value of a Living Trust as it compares to a Will.
Living Trusts: For Life and Death
A Living Trust and a Will both contain provisions for distributing your life possessions to your loved ones after you die. However, a Living Trust contains additional details that can be employed during your lifetime. If you become incapacitated, a Living Trust can give directions regarding how you want your possessions to be used and managed during this period, and even how you wish your health and life care to be carried out. It also allows you to identify the person of your choosing (Successor Trustee) to “step into your shoes” to manage the Living Trust assets for you. A Will does not have this ability, and can only give instructions for after you pass away.
Living Trusts: Private and Immediate
In the event you become incapacitated, a well-composed Living Trust which has been properly funded (re-titling your assets into the Trust) will give your family the direct benefit of avoiding a very expensive, public, and time consuming process of obtaining a guardianship and/or conservatorship to get the legal authority to make decisions for you. The person you name as Successor Trustee in your Living Trust will be able to immediately manage your care and assets according to your instructions, and not what the Probate Court decides you need.
By comparison, a Will only goes into effect at your passing. No information or instructions are provided to your loved ones regarding what to do in case you become incapacitated. With only a Will, your loved ones would almost certainly have to seek authority from the Probate Court, which is not something that’s easy, inexpensive, or granted quickly.
Living Trusts: Controlled, Flexible, and Accessible
Once your Living Trust is established and funded, you, as the Grantor and Trustee, control how your assets are managed. Additionally, a Living Trust is flexible in that you may change the terms at any point – including moving assets in and out of it at any time during your lifetime.
When you die, your assets will pass immediately to your named beneficiaries. If you feel your intended beneficiaries are too young or irresponsible to manage the assets on their own, these assets can remain in the Trust and be managed by your Successor Trustee.
The same Living Trust document that can keep you out of a court guardianship at incapacity will enable your loved ones to avoid probate court when you die. In contrast, a Will must go through the process of Probate. The Probate Court, with its many costs and probate attorney fees, is required to transfer your assets to your heirs after you die, and this will take some time. If, at the time of your death, you live in a town such as, Acton, Concord, Lexington or Sudbury, your family will need to file a probate petition in Middlesex Probate and Family Court in Cambridge, Massachusetts. The Probate Court will require you to keep the estate open for one year to allow any potential creditors to file a claim. This means it may take months or over a year before your loved ones can access needed assets.
Creating a Living Trust does cost more now, but when you consider the control and flexibility that a Living Trust provides, and compare it to the limitations and future cost of a Last Will and Testament, the value may seem apparent.
To find out if a Living Trust and/or Will is right for you, our experienced attorneys at Generations Law Group, with offices located in Acton and Sudbury, MA, are ready to help you make the best decision for your individual situation.