Should I Use a Living Trust to Protect My Property from Probate?
A living trust can be a useful tool for keeping property out of probate if it is used wisely. An effective estate plan may use a living trust to set aside certain property for a certain beneficiary, while preserving the use of the property for yourself during your lifetime. But, transferring property to a living trust can be tricky and should not be done without a full understanding of the consequences.
What is a living trust?
A living trust is also known as an inter vivos trust. A trust is essentially a legal holding place for property. Property can be transferred to a trust by a person known as the settlor for the benefit of one or more beneficiaries. The settlor can decide who will serve as the trustee and how the property in the trust may be used.
One way a living trust can be used to avoid probate is by transferring the settlor's home to the trust. The settlor can be the primary beneficiary of the living trust, with certain other beneficiaries named as remainder beneficiaries. The home then belongs to the trust, and must be used for the benefit of the beneficiaries, namely the settlor during his or her lifetime. When the settlor dies, the remainder beneficiaries automatically step in to benefit from the property, without needing to go through the probate process.
Living trusts can save money in the long run
Living trusts tend to cost more to set up than a last will and testament, but the expense should be recouped in the long run because whatever property is conveyed in the living trust is not included in your estate for probate purposes at the time of your death. In other words, using a living trust to minimize assets to be passed later through the will can minimize the expense of the probate process.
Contact an experienced Bryan-College Station, Texas estate planning attorney to discuss your needs and help you decide whether you should consider a living trust in addition to your will as part of your comprehensive estate plan. The Peterson Law Group finds solutions for our clients. Call us today to schedule a consultation at 979-703-7014 or fill out our online contact form.