Revocable Living Trusts
What is a Revocable Living Trust?
A Trust is an agreement where one person holds something for another person’s benefit. It is most commonly used to pass your money and property to your loved ones either during your lifetime or when you pass away. The easiest way to think about a Trust might be to think about the 3 people involved.
1. The Settlor is the person who creates the Trust. This is usually the person who owns the money and/or property that will go into the Trust.
2. The Trustee is the person or company in charge of holding and managing the Trust assets. The Trustee agrees to hold the Trust assets for the beneficiaries. In a Revocable Living Trust, the Trustee is usually the same person as the Settlor. This means that when you create this Trust, you will still be in control of your money and property even after those things are transferred to the Trust.
3. The Beneficiaries are the people who will ultimately receive the Trust assets. A Revocable Living Trust usually states that the beneficiaries will receive the Trust assets after you pass away.
A Revocable Living Trust is the most common type of Trust created. It is the cornerstone of a great estate plan. It is a way to transfer assets to your loved ones after you pass away without the need for Probate Court. It streamlines your estate plan and makes everything much easier for your beneficiaries.
Benefits of having a Trust instead of a Will
You might think that having a Will means that your beneficiaries won’t have to go through Probate Court. This is a MYTH! In fact, quite the opposite is true. In Kentucky, when you leave your assets to your loved ones through a Will, they almost always HAVE to go through Probate Court. The Kentucky Probate Court process is costly, time-consuming, and stressful. You can eliminate all of that worry by placing your assets in a Revocable Living Trust. Avoiding Probate Court is enough to justify the additional cost of creating a Trust, but the benefits are much greater than that alone.
A Trust allows for much more detailed planning than a simple Will. A Trust allows you the flexibility to decide how and when your loved ones will receive their inheritance. It is often not wise to leave someone all of their inheritance at one time, especially if that person is very young or not the best at handling money. With a Trust, you can spread out someone’s inheritance over time. This will ultimately help the beneficiary use their inheritance wisely.
Perhaps you are concerned about what will happen to your assets if you go into a nursing home. An Asset Protection Trust is a great way to protect your money and property, so it goes to your loved ones and not the nursing home. can even protect your assets from a nursing home.
Perhaps one of your beneficiaries is disabled and cannot receive his or her inheritance all at one time in order to maintain government benefits. A Special Needs Trust can protect the inheritance of a disabled beneficiary, so he or she can still receive government benefits.
What is the process to make a Trust?
If you’re ready to get a comprehensive Kentucky estate plan, you’ve come to the right place. At Bauman Estate Planning, we make this process very simple. By the way, the first meeting is free, so what have you got to lose?
Prepare for the First Meeting – Think about what assets you own. You should know where your accounts are located and what type of accounts you have. It’s also important to know who your beneficiaries are on your insurance policies and retirement accounts. Think about who you want to receive your assets after you pass away. Also, consider how you want them to receive their inheritance; all at one time or over an extended period of time. Lastly, think about who you want to be in charge of your Trust (Trustee).
First Meeting – I am glad to meet you at either my Dixie Highway or Breckenridge Lane office. We can also discuss your situation by phone if you prefer. We will discuss your different assets, your family situation, the beneficiaries of the Trust, and the Trustee. We may discuss other estate planning documents at this time. Depending on your situation, we might also talk about Powers of Attorney and Living Wills. I will also give you an estimate on the cost.
Prepare & Review Documents – Once you decide which documents you want, I will prepare them for you. I usually email a draft to my clients so they can glance over it and think of any questions or changes they have. Then, we will review the Trust together to make sure it’s perfect before we sign it.
Sign Documents – This is usually done at one of my 2 office locations, but we can do it by Zoom if you prefer. You will keep the original Trust and I will keep a copy. I can also make extra copies for you if you plan to give copies to someone.
As you can see, the process is fairly quick and painless. There is no reason to continue putting this off. None of us knows what the future holds. I’m happy to help you set up the perfect plan for you and your family!
Here are some links to other Kentucky estate planning documents I can help you with:
Call Bauman Estate Planning today at (502) 267-7967 or click on the link at the top of the page to schedule a phone call or in-person meeting with Jason.