Living Trust Pros and Cons
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Living Trust Pros and Cons

The whole idea of living trusts has a certain mysteriousness. You may think they’re only for very affluent individuals, or that they’re a lot harder to devise than a straightforward last will and testament. However, they can be an ideal estate-planning instrument for others.

A revocable living trust come with equally pros and cons, from staying away from probate to the expenses related with creating one. Determining if one is appropriate for you can be subject to your personal concerns and situation.

Advantages of a Living Trust

Avoiding Probate

Assets kept in a trust avoids probate since the trust on its own doesn’t pass away with its creator—known as the grantor or trust-maker in legal terminology. The trust stays up and running following the passing of its grantor, and it is able to transfer its property to individuals the grantor has provided for in the trust’s formation documentation, in accordance with the grantor’s own conditions. There’s no requirement for court supervision or involvement.

Avoiding probate is most likely the greatest advantage of revocable living trusts. It can be a particularly vital thing to think about if you’re the owner of real estate in more than one state since your loved ones would be faced with two or more probate litigation in this case when you simply leave a will. Each of the properties would be required to be probated where it’s located at.

Revocable living trusts are also able to give your loved ones nearly immediate access to cash throughout a difficult time. Your loved ones are generally unable to get access to your financial institution account until a probate estate has been formally initiated. Ask yourself how they are going to pay for funeral expenses and other necessary costs until this time.

Initiating a probate estate could take numerous weeks.

Avoiding Guardianship or Conservatorship

A revocable living trust isn’t only about death. They can enable your loved ones stay away from both an expensive court-supervised guardianship should you become debilitated in addition to an expensive court-supervised probate proceedings following your passing.

Your loved ones and your property would be subject to the limiting rules of guardianships or conservatorships should you become debilitated. Creating a revocable living trust requires appointing a successor trustee, an individual that steps in and administers the trust for you if the time comes when you are no longer able to take care of your personal matters yourself.

Your successor trustee is able to take control of your trust assets devoid of court interference after following your trust’s instructions for determining your debilitation.

Your trust’s instructions are your instructions—you establish them when you created the trust.

Keeping Things Private

Probate are public proceedings anyone is able to go to the courthouse and examine each and every document filed there, as well as your will. Strangers can even examine court dockets and/or filings on-line in some states. Anyone is able to see the degree of what you owned to leave to others, and they can discover who received what when probate was opened and your will is placed within the court.

Trust paperwork are never filed with a court, so they don’t turn into a matter of public record.

Disadvantages of Living Trusts

Funding a Trust Is Costly…And a Nuisance

It usually costs more time and money to create and fund revocable living trusts than to just writing a will—up to three times more, at least at the start. But, the cost can wind up being pretty comparable since probate costs money, also. That cost would be required to be added to the cost of writing a will for a just comparison.

You are required create new deeds and other documentation to transfer ownership of your assets into the trust following you forming it. You’ll have to contact your financial institution, investment and/or insurance companies, and transference of agents. You are going to have to change account and/or stock ownership and refresh beneficiaries. New stock certificates are required to be issued. Vehicles and watercraft are required to be retitled.

This is the significant drawback of using revocable living trusts for a lot of individuals, but it’s not worth its time, money, and labor to devise one when the trust is not fully-funded. The kind of assets you own and what is required to be done to get them funded into the trust needs to be thoroughly considered prior to you deciding to use this estate-planning device.

You Are Still Going to Require a Will and an Estate Plan

Your trust may only be somewhat funded when you pass away if you obtain new assets and disregard to move them into your trust. It can be unusually easy to fail to remember to transfer title to newly obtained assets into your trust as time passes.

You’ll still require a special type of will known as a pour-over will to “catch” any un-funded assets in this case. This will is going “pour” your assets into your trust when you pass away, as the name suggests. The pour-over will is required to be probated, but it can still be a priceless worst comes to worst scenario backup tool.

In addition, many assets cannot be owned by a trust. These include specific retirement plans and assets you may hold jointly with another person. For instance, you are unable to transfer ownership of your portion of a home to your trust when you own it as a joint occupant. You are going to need an optional means of transferring ownership of those assets, but you are still able to avoid probate when you utilize beneficiary designations.

Your Heirs Have More Time to Challenge a Trust

A lot of states have particular statutes that dictate who is able to contest a last will and testament and how much time they have to do so. The time period can be from thirty to one hundred and twenty days.

Compare this with challenging a living trust, in which until recent times was wide-open court proceedings subject only to state-particular ​statutes of limitation. These regulations are usually 1 to 5 years, but occasionally sometimes longer.

A lot of states have started to minimize this gap by decreeing specific laws that severely limit the timeframe for contesting a trust.

In Conclusion

It’s important to talk with a legal professional when addressing something as critical as estate planning. You’re going to want to be entirely sure that you understand all the pros and cons of your choices. This post is aimed to discuss general information and may not apply directly to your unique case.


  1. Garber, J. (2020, April 5). Weigh the pros and cons of revocable living trusts. The Balance. Retrieved September 15, 2021, from

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