An Overview Of Estate Revocable Trusts
There are two kinds of revocable estate trusts. The first kind, the inter vivos, or living estate revocable trust, has been ballyhooed for a while as one of the best ways to avoid many of the financial problems and delays which can result from passing on one's assets through a simple will. There are some very real reasons for the enthusiasm about revocable estate trusts, but before you decide to establish one as a part of your estate planning, you should take the time to consider some factors. Here are some basics on the nature of living estate revocable trusts: Establishing this type of trust during your lifetime, will allow you the full use of your assets and will let you change, or revoke, its terms, trustee, and beneficiaries at any time. You may continue to transfer assets to an estate revocable trust throughout your life; you may serve as its trustee; and you may manage the assets as you see fit for your own benefit and that of the trust's beneficiaries. When you die, your Successor Trustee will honor the terms of the revocable trust in distributing its remaining assets among your beneficiaries, or, if so instructed, will leave the trust intact and manage the assets for the benefit of you heirs. The revocable estate trust can, in other words, act as a simple will to direct the distribution of your estate. It differs from a will in that it can also be the means by which you manage your assets during you life, and it can authorize a successor trustee to manage your assets in case you should become incapacitated. It will eliminate the need for a legally appointed guardian. The second type of revocable estate trusts is the revocable testamentary trust. This trust, unlike the living trust, is incorporated as part of your will, and like your will, can be altered at any time. But unlike a living estate revocable trust, its terms do not go into effect until after your death. The testamentary estate revocable trust is designed to let you have some control over the management and distribution of your estate even after your death. It is commonly founding the wills of those who have minor children, because minors cannot inherit property. While the testamentary revocable estate trust can be changed during your life, it becomes irrevocable on your death, so that your Successor Trustee will be bound to manage and distribute your estate according to your wishes. A testamentary trust can even allow you to what becomes of your assets after your minor beneficiaries have reached their legal majority, by setting up a distribution schedule or conditions they must meet before they can inherit. The disadvantage of establishing a testamentary revocable estate trust is that, as part of your will, it will subject to the probate procedure. Its contents, therefore, will be made public, and your beneficiaries will be subject to a delay before your estate settles and the terms of your trust can be implemented. |
