The Advantages and Disadvantages of Revocable Trusts

estate planning

There is a peace of mind that comes with estate planning. It allows you to be prepared for the unknown. One of the biggest mistakes about estate planning is that many believe it to be a single document. Your attorney has a multitude of documents to choose from that each address different planning needs. They choose and create each one based on your needs.

Another common misconception is that for some, estate planning simply amounts to writing a will. Although a will is an incredible estate planning tool, it may not be the best option to protect you, your assets, and your loved ones. Take a look at a different option that you may use:

Advantages of Revocable Trusts

These are also referred to as living trusts or revocable living trusts.

Unlike a will, a revocable trust avoids probate. In addition to the probate process being public, it can be as long as it is expensive. Many people take deliberate steps to avoid it, and they can do so by creating a trust.

After your attorney has created this trust, you can put assets into it. There are many trusts, but when it comes to revocable ones, you can revoke them. When you create and fund a trust, you are referred to as the grantor. As the grantor, you can manage and distribute the assets in the trust. For example, as the grantor, you can place your home in a trust and still live in it.

These can be very convenient. If you own homes in multiple states, you can put them into the trust. It is one method of avoiding some of the complications associated with out-of-state properties during the probate process. Because you have to choose a successor trustee, you have a designated person who can manage your estate if something happens to you.

Disadvantages of Revocable Trusts

One disadvantage of revocable trusts is that your assets aren’t fully protected, nor are they sheltered from taxes. To avoid that issue, some people use irrevocable trusts instead. Irrevocable trusts which cannot be revoked once they are established. So why would you ever choose one? People do so because of what revocable trusts cannot do.

There are downsides to revocable trusts. Some people place things into trusts for asset protection. However, creditors can seize the assets you put into a revocable trust. The other element to consider is that using a revocable trust will not avoid income or estate taxes.

Get Help with Drafting a Trust

Since 1995, Amsberry Law has been helping clients with their estate planning and elder law needs. Estate planning requires a customized approach for each client. We not only can help draft a trust for you, there are a wide range of options in estate planning and we will draft every document to best protect your interests and needs.

Attorney Russell Amsberry

Attorney Russell J.G. Amsberry

Attorney Russell J.G. Amsberry founded the Amsberry Law Firm in 1995 with the goal of providing clients with exceptional, focused representation on their issues. His success as a legal advocate has been reflected in the numerous professional honors he has received, such as speaking engagements and inclusion in Scene in SA magazine’s listing of the best lawyers in San Antonio, a Distinguished rating from Martindale-Hubble, and an amazing rating from Avvo. [ Attorney Bio ]

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Amsberry Law Firm

The Amsberry Law Firm, founded in 1995, has helped thousands of clients overcome their unique legal challenges.

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