As part of a comprehensive estate plan, a living trust or revocable trust can confer some important benefits upon trustmakers (i.e., grantors) and their beneficiaries. Because, however, living trusts can have some significant advantages and limitations, we’ll point out some crucial facts to know about these estate planning tools so you can start to figure out if developing a living trust is in your best interests.
While the info below is general, you can get more specific answers pertaining to your situation by contacting the seasoned Pueblo estate attorneys at Gradisar, Trechter, Ripperger & Roth today.
Here’s What You Should Know about Living Trusts
1 – Living trusts can be changed or terminated by grantors.
Understanding the facts about living trusts can help you figure out if these tools are right for you, experienced Pueblo estate attorneys explain.
Once a living trust has been set up, grantors can alter the terms of the trust, change the assets held by the trust or even end the trust relationship altogether as long as they have the mental capacity to do so (i.e., are legally considered to be of “sound” mind). This can be an appealing aspect of living trusts, as it allows grantors to revise trusts over time as their life circumstances and needs change.
2 – Living trusts become irrevocable when the grantor passes away.
Once the grantor of a living trust passes away, the trust will automatically become an irrevocable trust, meaning that its terms and assets can no longer be changed. This can be an important fact for grantors to know, as it is a strong reason for them to regularly revisit and, if necessary, revise the terms of these trusts to ensure that they are up to date and reflective of the grantor’s latest wishes.
3 – Living trusts can be funded by various types of assets or property.
In fact, just some of the various types of property that can be used to “fund” a living trust include (but are not exclusive to):
- Real estate and homes
- Stocks and bonds
- Personal property, such as jewelry, fine art, antiques and/or collectibles.
Basically, any property that is solely owned by the grantor and that does not already have a beneficiary designation (such as a “payable or transfer upon death” designation) can be transferred into living trusts.
4 – The assets held by living trusts do not have to pass through probate.
This may be one of the more important facts about living trusts, as probate avoidance can be a central goal of the estate planning process. The bottom line is that any assets held by living trusts after a grantor dies don’t have to be probated, meaning that they can be transferred directly to beneficiaries (according to the terms of the trust) with less hassle and expense. Ultimately, this can mean that:
- Beneficiaries have to wait less time to obtain these assets.
- Probate costs can be reduced.
- More of the estate assets can go to the beneficiaries, rather than probate costs.
Trinidad and Pueblo Estate Attorneys at Gradisar, Trechter, Ripperger & Roth
If you need help devising a trust or developing an estate plan, the Trinidad and Pueblo estate attorneys at Gradisar, Trechter, Ripperger & Roth are ready to provide you with the highest quality legal services.
To learn more about our superior legal services and how we can assist you, contact us by calling (719) 556- 8844 or by emailing us using the contact form on this page.
From our offices based in Pueblo, we represent clients in Trinidad, La Jara, Lamar, Walsenburg, Alamosa and throughout the state of Colorado.