Revocable living trusts are a popular estate planning tool in Naperville that allows the creators to control their assets now while preparing for smooth transitions in the future. If prepared correctly, a revocable or “living” trust could accomplish many goals.
Those interested in creating or changing a Naperville revocable living trust are advised to consult an experienced trusts and estates lawyer for guidance. If legal requirements regarding the trust are not properly fulfilled, the trust could be considered invalid.
There are many reasons why revocable living trusts have become so prevalent in recent years. First, when a revocable living trust is prepared and assets are transferred according to legal requirements, the assets owned by the creator may be distributed directly to beneficiaries without the need to go through the lengthy and complex probate procedures. This could save a lot of money and headaches for family members.
In addition to avoiding probate hassles, Naperville revocable living trusts allow beneficiaries to access assets immediately and avoid the long delays when an estate is tied up in probate. A revocable living trust could also allow family members to control assets if the grantor becomes incapacitated without the need for a complex guardianship proceeding.
A trust is a legal entity created by trust documents. As an entity, a trust may own property including real estate and bank accounts. The person who creates a trust is often called the grantor because that person grants their property to the trust. A trust holds and manages property for the benefit of a beneficiary, and the assets of the trust are managed by the trustee.
In traditional trust situations, the grantor, trustee, and beneficiary are three separate individuals. In a Naperville revocable living trust, these roles are usually held by the same person.
In operation, the grantor executes documents to create a living trust and transfers their assets into that trust. The grantor, also serving as the trustee, continues to manage those assets and continues to gain the benefits of owning those assets, because that person is also the beneficiary of the trust. Daily transactions remain virtually unchanged.
When the grantor passes away, the successor beneficiaries gain access to the assets of the trust without the need for legal action. If the person who created the trust becomes incapacitated, the trust allows for a successor trustee to manage the assets of the trust for the benefit of the grantor. Thus, a revocable living trust could avoid the expense and delay of both probate and guardianship proceedings.
A revocable living trust may be structured to allow successor beneficiaries immediate access to assets or to allow the successor trustee to manage assets and wait to distribute those assets until the beneficiaries reach an age where they are able to manage property on their own. The trustee may be granted discretion to distribute amounts earlier if the trustee believes it would serve a beneficiary’s best interests.
A Naperville revocable living trust remains revocable, which means that terms could be changed, or the trust may be terminated at any time in accordance with the wishes of the grantor. Therefore, these types of trusts do not carry many of the risks inherent with the establishment of an irrevocable trust.
Those interested in learning more about how a revocable living trust could benefit their situation should consult a Naperville trusts and estates attorney. If a trust is not created properly or assets are not transferred correctly, the trust is not likely to accomplish the intended purposes.