During estate planning, you may explore various options for passing assets on to your children, grandchildren, or other loved ones. Two popular methods include creating a will or establishing a living trust.

The Benefits of a Living Trust

A living trust allows you to transfer assets to designated beneficiaries. One of its key advantages is that you maintain control over your assets while you’re alive. You can adjust the trust, adding or removing assets or beneficiaries as your wishes change.

Perhaps the most significant benefit of a living trust is that it bypasses probate, unlike a will. Probate is the legal process of validating a will, which can be time-consuming, expensive, and public. With a living trust, your beneficiaries may receive their inheritance more quickly and privately, as trust details are not part of the public record.

Considerations When Creating a Living Trust

The main drawback of a living trust is the initial cost. It costs more to set up than a standard will, especially if your estate is complex. Attorney fees can also increase based on the complexity of your financial situation.

It’s important to note that placing assets in a living trust won’t provide tax benefits. You will still be liable for any taxes you would normally owe on those assets.

A living trust may be a valuable tool for estate planning, but it’s essential to consult with your family and an attorney to determine if it’s the best option for your circumstances.