You already have a will, so why would you want a trust? Trusts can be set up to accomplish personal and financial objectives that go beyond the scope of your will. A revocable living trust is one arrangement that offers a number of benefits.
A revocable living trust allows you to transfer ownership of your assets to a trust and name yourself as the beneficiary. The trustee you choose will manage and distribute the trust property according to instructions spelled out in the trust agreement. You can name just about anyone you want — including yourself —as trustee. Or you can name an institution, such as a bank or trust company. Because the trust is revocable, you can change or terminate it at any time. Assets remaining in the trust when you die generally won’t go through probate.
After you set up the trust, you transfer assets by re-titling them to the trust. By adding a “pour-over” provision to your will, you can direct that remaining assets be transferred to the trust at your death.
Pros and Cons
Having a trust in place allows your trustee, co-trustee, or successor trustee to handle financial and investment decisions for your benefit and provide asset management for your family after your death. If you’re incapacitated, your trustee can manage the trust assets without the court’s involvement.
Since you can make changes at any time, a revocable living trust provides no tax benefits. And setting up and operating a trust typically involves upfront and ongoing costs. Talk to your Sioux City or Sioux Falls financial professional about whether a revocable living trust would be appropriate for your situation.
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