Although the primary benefit of a revocable living trust is its ability to avoid the probate process, there are numerous other ways in which using this estate planning tool can protect your assets and loved ones well into the future.
In fact, it can save your family members and friends considerable headaches after you pass away.
Living trusts protect your estate plan from challenges
Challenges to both wills and trusts are somewhat rare. However, if a challenge does happen, it is far more difficult to be successful in a challenge to a revocable living trust compared to a will. The main reason for this is that a trust typically features the trust creator being continually involved with maintaining the trust by transferring property in and out of it, or making certain amendments. This ongoing management provides sufficient evidence that you were competent enough to manage your own affairs.
If someone were to challenge the validity of your revocable trust, that person would need to prove either of the following:
- You were mentally incompetent or under someone else’s undue influence at the time you made the trust
- The trust document itself is flawed in some way, whether it’s because of a forged signature or some other issue that would make it invalid
In most cases, you don’t need to worry much about the possibility of a challenge to your trust, unless you have reason to believe a close relative or friend harbors some hard feelings about not being included in the trust. If, for example, you have children from a previous marriage who do not like your current spouse, or you are in a relationship your loved ones do not approve of, you might consider planning for the possibility of a challenge.
Living trusts help you avoid conservatorship
Another benefit of a living trust is that it can protect you if you become physically or mentally ill, and therefore incapable of managing your affairs. If you have established the trust with your spouse or partner, that person then takes control of the trust property. If you have an individual trust, the trust document authorizes your named successor trustee to take over certain duties during your incapacitation.
Without a trust, family members might have to go to court to be able to get the authority they need to handle their loved one’s finances, especially if that person has not outlined a power of attorney arrangement. This process can be long and stressful, and might require your spouse or adult child to ask the court to be named your conservator or guardian.
Trusts tend to be underused in the estate planning process. Thus, if you are interested in learning more about how you could benefit from adding a revocable living trust to your plan, meet with a knowledgeable New York estate planning attorney at Lissner & Lissner LLP.