Revocable Living Trusts
What is a Trust?
A Trust is a distinct legal entity capable of holding and owning property for the benefit of its Beneficiaries.
What's the Difference Between a Will and a Trust?
(1) Probate treatment - Property distributed through a Will is legally required to go through Probate court (expensive & time-consuming). Conversely, property held in a Trust at the time of your death avoids Probate.
(2) Longevity - A Will exists for a limited time. It distributes property upon your death, and that's it. However, a Trust can manage and distribute assets for as long as you instruct (or your assets provide). For example, if you have minor children, they could have their needs addressed under the management of a Trustee. Likewise, you could have any distribution of funds withheld until your children reach a more suitable age.
(3) The breadth of purposes- Trusts can accomplish much more than a Will. Trusts are instruments with far-reaching abilities. For example, Trusts can protect beneficiaries from creditors, or they can preserve government benefits for beneficiaries with special needs. Trusts are powerful legal instruments that serve clients in various ways.
Probate is a court-controlled process with mandatory fees based on the size of your estate. Missouri statutes set these fees. Even for small estates, forming a Trust is typically less expensive. Likewise, the Probate court usually requires hiring an attorney and jumping through many hoops. Probate can delay the distribution of your assets by several months to over a year. In short, Probate can be a headache. It is simpler and less expensive for most people to have a Trust formed.
What Are the Benefits of a Trust?
1. Financial Savings. You avoid the costs and headaches of Probate.
2. Peace of Mind. Provide for the long-term care of Beneficiaries--particularly relevant for those with minor children, special needs family members, or elderly dependents.
3. Privacy. Assets in a Trust discreetly transfer upon your death. Probate court is a matter of public record.
4. Freedom. You retain the ability to modify or eliminate the Trust.
5. Flexibility. You can move property in and out of the Trust during your lifetime.
6. Control of Assets. You maintain greater control over the distribution of your assets. For example, a Trust can provide beneficiaries maintenance for their basic needs while minors. Then distribute portions of the principal gradually (e.g., 1/3 at age 21, 1/3 at 25, and 1/3 at 27) at a more suitable age.