In Florida, a living trust works like this: You sign an agreement transferring your assets to a trustee. The person who owns the assets can also serve as the trustee. In many cases, the person creating the trust designates a bank or other independent professional to serve as trustee. That allows the trustee to manage the trust and pay expenses in the event that you become incapacitated. The arrangement can be crafted to allow you to access assets and withdraw money at any time. It can also be made revocable.
The trust agreement explains how the assets should be distributed when you die. That’s where a key benefit of a living trust kicks in: It allows your assets to be distributed according to your wishes without going through the complicated probate process.
Steering Clear of Probate
If you use a will to determine how your property will be allocated upon death, the courts have to get involved in a legal process commonly referred to as “probate.” A judge has to review the will to ensure that it’s legally valid and to hear challenges from anyone contesting it. The court also oversees the gathering of the assets (real estate, bank accounts, life insurance, retirement savings, etc.) and the paying of any outstanding debts before the money is distributed to those identified in the will.
The probate process takes time. The living trust avoids probate by effectively transferring your assets to the trust while you are alive. That means the trustee can start distributing your property as you intended without waiting on a judge to weigh in.
Costs and Savings
A living trust typically costs more to create than a simple will. That’s partly because the document is more complex, but also because it requires a number of steps to actually transfer your assets to the trust. That process is called “funding” the trust. In situations in which a person doesn’t want or is unable to transfer all of his or her assets to the trust, a separate will can be drafted to handle the distribution of that property. South Floridians considering a living trust are well advised to consult an experienced Miami trust lawyer to discuss whether they can transfer their homes into a trust without losing state homestead protections.
A living trust avoids court costs on the back end related to the probate process. It also allows you to keep your affairs private. Probate proceedings and court filings are made publicly available.
Contact a Miami Trust Lawyer at Hoffman & Hoffman P.A.
Hoffman & Hoffman is a South Florida estate planning law firm whose attorneys help people manage their assets and decide how property will be distributed in the event of their death. We are pleased to represent clients throughout South Florida, including in Ft. Lauderdale, West Palm Beach and Coconut Grove. Contact us today to speak with a lawyer.