1. They’re Not Just for the Rich
Trusts are very handy for avoiding probate, a time consuming and expensive process. In contrast, wills do not avoid probate. An estate with a gross value of $150,000 or more has to go through probate in California (other states have different rules). That means pretty much any California homeowner’s estate will have to go through probate unless they take action. That said, trusts aren’t for everyone, especially if you don’t need one to avoid probate.
2. They’re Easier Than You May Think – Your Work Is Pretty Easy
It’s a mistake to think that handling your property through a trust is complicated. The reality is that, apart from changing the title on your accounts and property, nothing changes for you. You have the same control as you did before, and you conduct your affairs the same as you did before. The difference is this – with a revocable living trust in place, you’ve taken control over who gets what and when they get it.
3. They Harder Than You May Think – To Create Them Right
Just because managing a trust is easy on your end doesn’t mean that creating trusts correctly is easy. Trusts are a lengthy legal document after all. There are many companies out there happy to sell you a binder of papers that have the title “trust” on them. Buying a product not designed for you, which you don’t understand is a recipe for trouble. At Estate Plan Pros, we believe that your estate plan is a reflection of your unique needs, including family dynamics, financial goals, and many other factors. You should work with someone offering professional estate planning services.
4. They Won’t Do Any Good If They’re Not Funded
A trust won’t actually avoid probate by itself. The trust has to actually “own” your accounts and property to avoid probate. This is where a lot of companies that offer trusts as a product do their clients a disservice because the natural expectation is that having paid your money, and received the shiny binder, you’re done. The reality is they expect you to do the work of knowing what should go in the trust, what shouldn’t, and the consequences of your decisions. This is why good estate planning attorneys spend a lot of time talking to their client’s about what they own, as well as what their goals are.
5. They’re Affordable
Complete estate plans aren’t your cup of coffee, but they don’t cost an arm and a leg either. The high end estate planning that involves protecting assets from creditors or estate taxes can be pricey, but for families with simple needs the cost of doing an estate plan is very affordable.
6. You Can Change Them
In fact you should change your estate plan when things in your life change. Revocable living trusts are designed to be changed. I’ve worked with clients that have made three, four, or more changes to their estate plan over the years. Life happens, and things change. It is important to make sure your plan adapts to your life now, and trusts give you that flexibility.
7. You Can Do A Lot Of Cool Things With Them
Trusts simply can do so much more than a simple will. You can set financial goals and guidelines for your children. You can provide for your special needs child. You can balance the needs of your blended family. You can provide for your child and prevent having them from using the money in self-destructive ways. And the list goes on.