A description of the two main alternatives to Estate Planning

What is a Will? A Will is a legal document that directs the Probate Court as to how your assets are to be distributed at your death. If you do nothing else, a Will virtually guarantees that any assets owned by you in your individual name at your death will go through Probate. A Will can be changed or canceled by you at any time during your life, for any reason. A Will only "speaks" at your death and provides no protection for you should you become incapacitated during life.

What is a revocable Living Trust? A Revocable Living Trust is a legal document that looks a lot like a Will. In fact, it does what most people think a Will does -- and much more. It is an accepted method of Estate Planning that has been used effectively (in one form or another) for hundreds of years. It is called "revocable" because it can be changed or canceled at any time during your life, for any reason. It is called a "living" trust because it is set up during your life.

How does a Living Trust work? When you set up a Living Trust, you transfer all of your property from your individual name to the name of your trust (for example, from "John and Mary Smith, husband and wife" to "John and Mary Smith, as Trustees of The John and Mary Smith Revocable Living Trust dated __________"). Although the concept is very simple, it is this transfer of ownership that allows the Living Trust to work.

Is it hard to transfer property into a Living Trust? No. In addition to your attorney, your banker, trust officer, financial planner, investment advisor, stock broker, insurance agent, etc. can assist you.

Do I lose control of property transferred into my Living Trust? Absolutely not. You keep control over your property. As trustee of your trust, you can do everything you could do before -- buy and sell, make changes, even cancel your trust and transfer your property back into your individual name.

Can someone other than myself act as trustee of my Living Trust? Yes. Certain individuals find it helpful to have a bank, trust company or other competent individual or entity act as trustee to oversee the investment of the trust's assets and the operation of the trust. Remember, you always have the right to replace any trustee and designate another, including yourself.

Go to Make the Comparison for a comparison of what happens at your death, or if you were to become incapacitated during life, and (a) you do no Estate Planning at all, (b) you make a Will, or (c) you set up a Living Trust.