Yorkville Estate Planning Attorney: Frequently Asked Questions About Living Trusts

 Posted on March 30, 2023 in Estate Planning

Structuring one's financial, retirement, and estate planning alternatives to efficiently and affordably leave one's assets to one's loved ones is known as estate planning. Individuals regularly worry about their investments and how the market may harm them.

Asset diversification and asset protection are two legal specializations that work together to optimize protection from events that deplete an individual's assets. Asset management is proactive planning before legal disputes, taxes, and other life occurrences harm a person's wealth and security. Asset protection and estate planning are two practical wealth management techniques that complement one another to provide monetary stability.

A solid legal foundation will be created through estate planning and wealth management, protecting against disability and death. In addition, a person's and their family's assets are safeguarded from hazards by creating an asset management plan. Living trusts are a crucial part of effective estate planning

What is a Living Trust?

A living trust is a legal document that enables you to fund a trust with assets while still alive. The assets are still in your possession but now belong to the Trust. You designate a trustee in charge of looking after and safeguarding the Trust's resources. The persons you choose as your beneficiaries will receive the Trust's assets after your passing.

Living trusts are frequently presented as the best estate planning tool. At Peace of Mind Asset Protection, LLC, this blog answers the most commonly asked questions about living trusts.

What distinguishes a living trust from a will?

Transferring your assets into the Living Trust is essential. The Living Trust will only apply to purchases transferred into the Living Trust's name. Living Trust uses during your life and beyond your life. The Living Trust will only apply to assets titled in the Living Trust's name. Unlike a Living Trust, a Will must go through the " probate " court process to become active. A will is a legal document that specifies how your assets will be distributed after your death. A will must go through probate court upon one's death, and often, a will requires hiring a probate attorney

Should I make a will as well?

Drafting a will and a Living trust go hand in hand. The pour-over will is an emergency document if one fails to transfer their assets into their Living Trust's name. A Pour Over Will is generally part of a well-founded estate plan.

What advantages does a living trust offer?

Living trusts are popular since they have many advantages. First, the Living Trust avoids probate court. The Living Trust avoids delays and costs associated with probate. A will and testament may require months to progress through probate court. In contrast, a Living Trust is dispersed quickly after your passing. Finally, a Living Trust is a private document, unlike a will and testament

What disadvantages do Living trusts have?

A Living trust's drawback is that it can only manage the assets you directly transfer into it; as a result, if you change the owner of something like a bank account, the Trust moves as well.

If you use a Trust for your estate planning, the assets not covered by the Trust will be distributed following your state's intestacy laws. Therefore, the pour-over will automatically transfer the decedent's assets to the Living Trust. In addition, the Living Trust is an investment and more expensive upfront. Therefore, unlike a will and testament, the Living Trust offers one the ability to minimize estate costs

Which assets can be included in a living trust?

Your assets should be transferred to your Living Trust. Funding of your Living Trust is vital, and assets such as real estate, bank accounts, certificates of deposits, and life insurance should be transferred to your Living Trust's name. In addition, transferring your assets into your Living Trust's name is critical to creating a smooth transition upon death or incapacity.

Is a power of attorney still necessary?

Your assets should be owned and managed by a Trust. A power of attorney works in coordination with your Living Trust. Powers of attorneys for finances and healthcare appoint a responsible person to manage your finances and make healthcare decisions when you cannot assist in the decision-making. A power of attorney is one of the critical estate planning documents.

Who ought to act as my trustee?

When you establish a living trust, three parties are involved: you (the creator), the trustee, and the beneficiaries. The trustee has a duty under the law to supervise the distribution and management of all assets consistent with your Living Trust.

Most individuals designate themselves as trustees to oversee the Trust's assets while they are still alive. If you'd like, you can pick any individual or even a business to serve as your trustee. If you want to be the trustee, you must also choose a successor trustee who will take over the Trust following your passing. Many parents typically appoint their kids as successor trustees.

Should I fear my kids won't handle the estate responsibly once I pass away?

It's crucial to pick your estate's replacement trustee wisely. If you are afraid that your children won't be able to handle it, you can name a qualified fiduciary to act as your successor and transfer your assets following your desires.

You can choose a fiduciary, a private fiduciary, a lawyer, a business, or your bank's trust division. Also, you can divide up your assets over a certain length of time in a way that will provide you peace of mind.

Should I expect family disputes following my death?

You can include provisions in your Living trust to prevent family disputes over the distribution of your assets after your passing if you are worried about them. Although a living trust can still lead to issues from a disgruntled heir, having one in most situations eliminates frequent reasons for family strife when a loved one dies.

Do estate and probate taxes get avoided by a living trust?

Estate taxes levied by your state or the federal government are not avoided by a revocable trust (one that can be changed during your lifetime). An AB trust is a unique living trust that transfers assets straight from one spouse to another while avoiding estate taxes. In addition, your estate won't be responsible for probate fees or expenditures since Living trusts do not pass the probate process.

Will I need to modify my estate plan while I'm still alive?

With a revocable living trust, you control your assets while alive and at death. You also can modify or dissolve the Trust whenever you choose. In addition, as the trustee, you have direct control over your assets. You can sell, transfer, and transfer assets whenever you like. A Living trust is a powerful estate planning tool.

How do I set up my Living trust?

Your Living Trust should be specific to your state. Carefully choose a trustee and successor trustees who will execute your wishes. Creating a real estate plan is essential to reduce and minimize family conflicts upon your death or incapacity. A crucial role of an estate planning attorney is guiding you and your family on the pitfalls of estate planning. A significant surprise is the unforeseeable risks inherited in your family but unrecognized by you

Should I Think About Making A Living Trust Without A Lawyer?

The simple answer is NO

Experience and competency are irreplaceable. An experienced estate planning attorney benefits from trial and error and the expertise that most individuals lack. Unfortunately, living trusts that could have been better drafted led to several issues and challenges. These challenges result in thousands of dollars in high costs and fees.

A general software package is less-experienced but fails to provide a third-party perspective on how to avoid family conflicts and disputes. A knowledgeable estate planning lawyer is invaluable in preventing unnecessary estate litigation.

Contact a Living Trust and Estate Planning Lawyer Today

Peace of Mind Asset Protection, LLC focuses on estate planning for families in Yorkville, Oswego, Plano, Newark, Sandwich, and surrounding areas. Our attorneys utilize advanced estate planning, estate and gift taxation, and other asset protection methods, providing a well-thought-out structure that smoothly transfers one's assets. We are skilled and knowledgeable estate planning attorneys that can customize your estate plan to your particular concerns and situation. In addition, we will educate you about your available legal options and map out estate planning strategies that meet your needs

Placing one's possessions in a comfortable position, such as real estate, commercial holdings, and other assets, can significantly decrease or eliminate legal concerns. Call a Yorkville Living Trust and Estate Planning lawyer at 630-780-1034 or use our online contact form, and a lawyer or member of our staff will contact you to schedule your first consultation.