Basics of a Living Trust
A living trust can be used to avoid probate. Although you can draft a living trust with the assistance of a lawyer, it’s also possible that you might be able to draft with yourself. The main goal of most estate planning is to avoid the probate process. Revocable living trusts are different from a will because a living trust offers a private way to transfer property after death, all while avoiding the probate process. A living trust is also not a total substitute for a will, so knowing the difference between the two is important for your individual situation. Living trusts are better used to transfer items like a house, where is a will provide the opportunity to name a guardian for a child. Since each has their own benefits, you should carefully consider which is the best for your needs.
If you choose to hire an attorney to assist with your living trust, expect to pay between $1000 and $2000, although individual cost me very. Living trusts are relatively easy to draft, but it may be to your benefit to have the guidance of a professional as you do so. A living trust has several common components. For example the trust must detail the name of the person creating the trust, which is known as a grantor or settlor. An additional person must be appointed to manage the trust itself. This is known as a trustee. If you are generating your own trust, it’s possible that you may also be the trustee. If you do name yourself as the trustee, make sure to list the name of an additional person in the event that you pass away or become incapacitated. The majority of people will feel comfortable selecting a grown child, spouse, or friend. Just like a will, a living trust must detail the information about who receives the property. If you are naming any young beneficiaries to receive assets from the trust, it may also be necessary to appoint a guardian to represent those beneficiaries.
In order to be valid, the trust needs to be signed in front of a notary. The trust is not effective in less all the property listed within the trust is detailed in the terms to be transferred into the name of the trustee. You could do this by using a standard transfer document or a deed. Depending on the complexity of your individual situation, you may need to hire outside assistant to help you draft the trust so that is as favorable as possible to your estate planning solutions.