When it comes to estate planning, one of the most important decisions you can make is how to manage your assets. Should you keep them in a revocable living trust or surrender them through a will? Understanding the differences between these two options can help you make an informed decision. A revocable living trust is a legal entity that allows you to transfer your assets into the trust's name. This type of trust is often referred to as a “living trust” because it is created while you are still alive and can be changed or revoked at any time.
The assets of the trust are still considered the property of the owner, so they are not subject to probate or estate taxes when the owner dies. In contrast, a will takes effect upon death and must go through succession. This means that your assets will be subject to probate and estate taxes, which can be costly and time-consuming. Additionally, wills are public records, so your affairs will not remain confidential when you die.
An irrevocable living trust is best if you want to minimize taxes, but if you want flexibility and reserve the right to revoke your trust, a revocable living trust is probably the best option. By establishing a revocable trust with dynasty provisions, you can help protect multigenerational wealth and keep your affairs confidential. When deciding whether to use a will or a revocable living trust for estate planning, it's important to consider all of your options. A revocable living trust may be more expensive up front, but it can save you money in the long run by avoiding probate costs and delays.
It also offers more privacy than a will and is much more difficult to challenge. No matter which option you choose, it's important to consult with an experienced estate planning attorney who can help you make an informed decision about how best to manage your assets.
