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Why You Need a Living Trust in Your Estate Plan if You Live in California

by | Jun 21, 2023 | Estate Planning, Trust Administration | 0 comments

A living trust, also known as a revocable living trust, is a legal document that allows you to transfer ownership of your assets to a trust during your lifetime. The trust is managed by a trustee, who is responsible for managing the assets and distributing them according to the terms of the trust. The trustee is typically you and/or your spouse while you are alive and well, and one or more other trusted persons if you become incapacitated or pass away.  The following are some of the many reasons why you may want to consider including a living trust in your estate plan.

In California, one of the main advantages of a living trust is that it allows you to avoid probate. Probate is a court-supervised process that is required to prove the validity of a will, identify and inventory the assets of the estate, pay debts and taxes, and distribute the assets to the beneficiaries. This process can take a considerable amount of time, often in excess of a year, and incur significant legal and administrative costs. With a living trust, the assets that have been transferred to the trust do not go through probate and can be distributed to the beneficiaries according to the terms of the trust without court oversight.  Administering your estate through a living trust is typically significantly quicker and less expensive than administering your estate through the probate court.

A living trust also provides more privacy than a will. A will is a public document and is lodged with the court after you pass away.  Therefore, anyone can request a copy of it and see how your assets are being distributed. In contrast, a living trust is a private document, and the terms of the trust are not made public if it is administered without court involvement.

A living trust also allows you to plan for incapacity. If you become incapacitated and unable to manage your own affairs, the trustee of your living trust can take over management of your assets and make decisions on your behalf according to the terms of the trust. This can provide peace of mind knowing that your assets will be taken care of even if you are unable to do so yourself.

Additionally, a living trust can provide for beneficiaries that have special needs.  For example, a living trust can provide for the management of assets for underage beneficiaries or beneficiaries that are incapacitated or getting needs-based government assistance such as Medi-Cal.  A living trust can also include provisions to allow a beneficiary, such as a child or spouse, to use a house during their lifetime, and then have that house distributed to other beneficiaries when your child or spouse no longer lives in the house.

These are just some of the many benefits of including a living trust in your estate plan.

Contact the Law Office of Carol A. Fauerbach at (916) 597-1305 to learn more about living trusts and to discuss options for developing a customized estate plan that meets the unique needs of you and your family.

Disclaimer – The information you obtain at this site is not, nor is it intended to be, legal advice and does not establish an attorney-client relationship. You should consult an attorney for advice regarding your individual situation. We invite you to contact the Law Office of Carol A. Fauerbach at (916) 597-1305, and welcome your calls, letters, and electronic mail. Please do not send any confidential information to us until such time as an attorney-client relationship has been established.