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time of death. A living trust lets you control the distribution of your estate. You transfer ownership of your property and your assets into the trust. You can serve as the trustee or you can select a person or an institution to be the trustee. If you’re the trustee, you will have to name a successor trustee to distribute the assets at your death.
Facts for Consumers
What is the advantage of a living trust? The FTC says that if properly drafted and executed, it can avoid probate because the trust owns the assets, not the deceased.
A living trust is an instrument that wraps around your estate and takes over ownership of any assets that you decide to fund it with. You still maintain complete control over everything owned by the trust, and are not limited to what you can do with the assets. However, having your assets owned by your trust gives you and your heirs specific advantages in terms of maintaining control and privacy of your estate plan. Assets are able to be transferred directly to intended heirs without ever incur- ring the probate process upon your death. Because of this, none of the costs or privacy issues associated with probate is ever encountered. Only property in the name of the deceased must go through probate. And the downside? Poorly drawn or unfunded trusts can cost you money and endanger your best intentions.
A will is a legal document that dictates how to distribute your property after your death. If you don’t have a will, you die intestate, and the law of your state determines what happens to your estate and your minor children. The probate court governs this process. A living trust is dif- ferent from a living will. A living will expresses your wishes about being kept alive if you’re terminally ill or seriously injured.
So, regarding a living trust, the FTC advises you to proceed with caution. Because state laws and requirements vary, “cookie-cutter”
How to Make Sure Living Trusts are Trustworthy 13