There are several good reasons to have a revocable trust (sometimes also called a “living trust”).

First, for our older clients, a revocable trust enables them to appoint a co-trustee (usually a trusted family member, often a son or daughter) to serve with them in managing their financial affairs, which can be particularly helpful as a person ages.  Of course, a good financial power of attorney can be a substitute for this arrangement, but given a choice, a person is generally better empowered as a trustee than as an agent under a power of attorney.

Second, a revocable trust can be an effective way to accumulate assets for administration by the trustee or trustees, ease administration after your death, and perhaps enable you to minimize or avoid probate.  In this modern age, probate avoidance requires a careful review of the title to all of your assets, and proper funding of the trust.  If you do not know how to properly fund your trust, you need to talk with a lawyer.  Proper funding requires a review of all of your assets to make sure the necessary assets are properly titled in the name of your trust.

Third, a revocable trust is indispensable in enabling high net worth individuals to minimize or avoid federal estate taxes.

We are often surprised at the number of people who have revocable trusts, but do not understand the reason for them and have not kept them current.  Like all of your estate planning documents, you need to review your trust periodically to make sure your assets will be distributed as you wish, and to make sure your selection of a successor trustee remains appropriate, that is to say, that the person who is named in the trust to take over if you become incapacitated or pass away is in fact the person you want to have serve.

There are several good reasons to have a revocable trust (sometimes also called a “living trust”).

First, for our older clients, a revocable trust enables them to appoint a co-trustee (usually a trusted family member, often a son or daughter) to serve with them in managing their financial affairs, which can be particularly helpful as a person ages. Of course, a good financial power of attorney can be a substitute for this arrangement, but given a choice, a person is generally better empowered as a trustee than as an agent under a power of attorney.

Second, a revocable trust can be an effective way to accumulate assets for administration by the trustee or trustees, ease administration after your death, and perhaps enable you to minimize or avoid probate. In this modern age, probate avoidance requires a careful review of the title to all of your assets, and proper funding of the trust. If you do not know how to properly fund your trust, you need to talk with a lawyer. Proper funding requires a review of all of your assets to make sure the necessary assets are properly titled in the name of your trust.

Third, a revocable trust is indispensable in enabling high net worth individuals to minimize or avoid federal estate taxes.

We are often surprised at the number of people who have revocable trusts, but do not understand the reason for them and have not kept them current. Like all of your estate planning documents, you need to review your trust periodically to make sure your assets will be distributed as you wish, and to make sure your selection of a successor trustee remains appropriate, that is to say, that the person who is named in the trust to take over if you become incapacitated or pass away is in fact the person you want to have serve.

Finally, if you have a minor or adult child with disabilities, you need a special needs trust. Read more about special needs trusts under that section of our website.

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