There are a lot of assumptions, confusion, and misinformation regarding revocable living trusts today. In addition, there is a lot of downright wrong, incomplete, and misleading information regarding revocable living trusts. I receive questions nearly every day from Tennessee families that they were told about the horrors involved in creating a trust.
Therefore, I am going to put to rest most of the assumptions and confusion when it comes to revocable living trusts. First, a trust can be used by a Tennessee family for a variety of different reasons. For instance, some people may want to make the estate settlement process simple, other people may want to avoid a difficult probate court process for their family, some people may want to avoid taxes, some people may want to avoid nursing home poverty, some people may want to make certain their children’s inheritance is divorce and creditor proof, some people may have children with special needs that they do need to plan for, and some people are even in a second marriage situation and have several questions and concerns about how this affects their estate plan. There is a multitude of different reasons on why a Tennessee family may want to set up a revocable living trust depending upon your unique family situation.
However, one of the main reasons on why a family would want to set up a revocable living trust is just to make things simple for their surviving family. Whenever someone passes away in Tennessee and owns property, that property must be distributed under the supervision of the probate court system. This is a process where a court will supervise the transfer of assets, the payment of your final bills and funeral expenses, and the payment of any remaining creditors, taxes, and even Medicaid lien. If there are any outstanding expenses, costs, and taxes, these must be paid first before the probate court judge will authorize the distribution of the remainder of your estate assets to your surviving family members.
A revocable living trust, on the other hand, allows the individual creating the trust to transfer ownership of all of their property and assets to the name of the trust. The individual will still be able to have complete control over the trust assets as trustee (nothing will change). However, when that person passes away, instead of having to go through a supervised probate court process, all of your assets would pass smoothly and easily to your surviving family members without the whole probate court mess that could last upwards of 2 years and costs tens of thousands of dollars in financial cost.
Now, as I said above, this is only one of the reasons why a family may want to establish a revocable living trust. There are many, many different reasons on why a family would want to set up a revocable living trust, and each one has its own unique set of benefits.
If you have questions about estate planning in Tennessee or how you can set up your legal affairs so that your assets are protected and you provide a smooth transition to your loved ones, then I encourage you to attend one of our live free educational events scheduled this month. At these events you will hear a lot of real life stories about families that paid thousands of dollars in unnecessary expenses, families that were able to avoid unnecessary expenses, and families that enjoyed zero government intrusion into their families’ private lives.
I look forward to speaking with you at one of our upcoming live educational events!