I field this question every day. My response is always the same, it depends. So, when should someone consider a Trust-based estate plan*? Well, here are a few things to consider:
- Do you own property in another state? If so, a trust may be a good way to prevent the need for multiple probate proceedings.
- Are you concerned about the fact that probate is a public and sometimes expensive process? If the answer is yes, then you may want a trust to help avoid the probate process.
- Do you want a professional fiduciary to assist with the management of your assets if you become incapacitated? If so, then a trust could be an important part of your incapacity plan.
- Is there a possibility that someone might contest your will? If so, then you may consider establishing a trust to increase privacy and limit the opportunites for a lawsuit.
Of course, this list is NOT exhaustive and there are other reasons to recommend a revocable trust. Conversely, there are many situations where a revocable trust is unnecessary, or maybe even a bad idea. It all depends upon a clients individual situation: the client’s goals, the fiduciaries named in an estate plan, the intended beneficiaries, and the type of assets owned by the client. For a more in depth analysis of whether a trust is right for you, read this article by Jayne Sykora. You should also consider calling your legal advisor to discuss the pros and cons to having a revocable trust.