If you want to take the necessary steps to protect your assets, creating a trust is often a preferred method. However, you may not fully understand the importance of ensuring this document is error-free. As such, knowing the most common mistakes is essential when creating this document, as it ensures your trust can be carried out according to your wishes. If you’re unsure of the most common issues with living trusts, the following blog can help you stay alert. Similarly, enlisting the assistance of PA trust attorneys can help guide you through this complex process.
What are living trusts?
Before understanding why making an error on this document can be detrimental, you must first understand what a living trust is. A living trust is a legal estate planning document that goes into effect during your life. You will designate assets to beneficiaries who will receive their inheritance upon your death. A trustee will be appointed to manage the estate for you during your lifetime and to ensure the assets are distributed according to the terms of your trust upon your passing.
This varies from a will because a living trust goes into effect as soon as it is created. Wills, on the other hand, must go through the probate process. As such, a trust will bypass this period, so your assets can be distributed immediately.
What mistakes do people often make?
By far, the most common error people make is failing to fund the trust properly. If you do not put the necessary assets and funds into the trust, your assets will endure the probate process. As such, you must change the titles and designate your beneficiaries.
In most instances, you will be the trustee. However, it’s necessary to designate a successor, as they can take over the responsibilities should you become incapacitated or unable to do so yourself. Be sure to carefully consider who you’d like to assume the role, as they are responsible for a number of crucial tasks.
However, the most glaring mistake many make when creating a living trust is trying to do it on their own. Unfortunately, many assume they can use the free or reduced-priced templates online to fill out the form by themselves, but this is far from the truth. Ensuring you have the assistance of an attorney to help you create a living trust is a surefire way to guarantee that your document is free from errors that could invalidate it.
At Friedman Schuman, our dedicated legal team can help you through the complexities that planning an estate often carries. As such, we will do everything possible to help make this process as simple as possible. Contact us today to learn how we can assist you if you’d like to set up a living trust.