Revocable Living Trusts

PROS

1. Assists in managing your assets and property
2. Privacy – Your Will becomes a public record once you pass away
3. May help avoid probate
4. Avoids potential guardianship if you become mentally disabled
5. Avoids complications of anyone contesting your Will
6. Assists in managing real estate outside of Texas

CONS

1. Cost – Living Trusts are significantly more expensive to created and administer
2. Burdensome to transfer the title of all of your property into the name of the trust
3. Must title all new property in name of trust
4. Complicated to administer
5. Still need a Will
6. Does not save you taxes any better than a well-drafted Will

For most people, a carefully drafted Will, prepared by a qualified Texas attorney, is an efficient and effective way to manage and distribute your property. An attorney may help guide you as to how to designate your assets, such as life insurance, bank accounts and retirement accounts, so that they do not have to go through probate.

Additionally, a “Statutory Durable Power of Attorney” allows you to designate an individual to act on your behalf in you are disabled or incapacitated. Another document you can prepare is a “Declaration of Guardian in Event of Later Incapacity or Need of Guardian,” which names an individual to manage your person and property if you become so incapacitated or disabled that a guardian must be appointed.

Overall, the Living Trust isn’t guaranteed to save you money or taxes. Texas has inexpensive probate procedures for the size of most estates if you have a properly written Will. Also, if your records are well-organized, your assets are simple (not necessarily small, just easily identified), your beneficiaries aren’t likely to argue, and your probate court and lawyer are efficient, legal costs of probate might be so low that it costs less to pass the property through a Will than via a Living Trust. Finally, with a well-drafted Will, along with a Declaration of Guardian and Powers of Attorney, you can accomplish many of the benefits of a Living Trust in a less complicated and less expensive manner.

A Trustee is the individual or individuals responsible for administering a Trust. For example, if you create a Trust for the benefit of your children upon your death, the Trustee will be the one who is responsible and legally accountable for making sure that the Trust property (i.e. funds) is used for the benefit of your child in accordance with your wishes as stated in the Trust language.