Advantages of Using a Living Trust in Michigan Estate Planning

A will is not the only document you can use to name beneficiaries for your estate. While it is very important that you have a Last Will and Testament, you should also discuss other tools and documents you can use as part of a comprehensive estate plan. Our Michigan estate planning lawyers can discuss various options for your estate, including the use of trusts as part of your estate plan.

What is a Living Trust?

There are several different types of trusts that you might utilize as part of your estate plan. A living trust is much like a will in that it specifies what you want to do with your property. However, a living trust is effective during your lifetime, but a will does not be effective until your date of death. Trusts are used for a variety of reasons; however, you must choose between a revocable living trust and an irrevocable living trust before you begin setting the terms of the trust.

A revocable living trust is an agreement whereby you transfer assets into the trust; however, you retain control of those assets as the trustee. With a revocable trust, you can revise the terms of the trust, or you can revoke the trust at any time. The assets would then return to you.

An irrevocable living trust requires that you transfer your assets into the trust permanently. You cannot change your mind after setting up the trust because you have relinquished all rights and ownership interests in the transferred property to the trust. Upon your death, your beneficiaries inherit the property within the trust, or the trust continues pursuant to the terms of the trust.

Benefits of a Living Trust

Some of the common benefits you might receive if you utilize a living trust as part of your Michigan estate plan include:

  • Protection From Creditors

If you choose an irrevocable trust, you might protect your assets from being seized or attached because of a debt collection. You must be cautious and consult an attorney before taking any steps to ensure that an irrevocable trust is correct for you because once it is signed, you cannot simply void the trust.

  • Avoiding Probate

Using a living trust can help you avoid probate. Avoiding probate can reduce the amount of stress your family suffers after your death. A probate case could take months to settle, thereby depriving your family of much-needed property and income. With a trust, your family can avoid probate to receive your property more quickly and less expensively than going through the probate process.

  • Avoiding Conservatorships

Your will does not become effective until you pass. However, a trust can continue even after you are impaired and unable to manage your financial affairs. Instead of your family being forced to file a petition with the court to be appointed to manage your finances and property, the successor trustee named in your trust simply takes over the management of the trust if you become incapacitated. This can be very important when you family relies on steady income from the trust. You want the trust to continue without any issues to provide support and money to your family members.

  • Avoiding Motions to Contest

If your family members or other parties disagree with the terms of your will, they can file a motion to contest the will with the Probate Court. They may try to claim that you were being coerced or you were under undue influence when you signed your new will.

However, with a trust, you are required to manage the trust or be involved with the trust. In many ways, the fact that you must continue being involved with the trust can translate into “sound mind” if anyone tries to contest your wishes.

Get More Information About Living Trusts from a Michigan Estate Planning Attorney

The Michigan estate planning lawyers of The Elder Care Firm of Christopher J. Berry, CELA can help you develop an estate plan that includes various documents and tools, including trusts, to help you meet your goals and ensure your desires are honored upon your death or incapacitation. Request your free consultation by calling 888-390-4360 or use the contact form on our website. A trust does not need to be overly complicated to meet your needs. Let us explain more to you during your appointment with our estate planning lawyer.

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