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Sitting down to create an estate plan is a positive step towards protecting your future and your legacy. As you begin this process, you will likely weigh the benefits of including a living trust along with the rest of your estate planning documents. Some people make the mistake of shying away from using a living trust because they fear that it will overly complicate their estate plan. This is typically not the case, however. Living trusts normally add many benefits to an estate plan, including ease of administration.
Five Reasons Why Creating an Estate Plan With a Revocable Trust Is Not Overly Complicated
Fear of a living trust over complicating an estate plan often stems from a fear of the unknown. Trusts seem like a foreign concept to those who have never used one in the past. In fact, living trusts are actually extremely user friendly, flexible, and beneficial to estates of all types and sizes. The following are five reasons why a trust can make your estate plan more efficient rather than overly complicated:
- Revocable living trusts are not treated as separate taxable entities. This means that you will not have to prepare any additional tax returns or forms for your trust.
- Placing all of your assets into your trust makes it easier to manage your affairs because they are all in the same place.
- Funding a trust does not have to be overly complicated. Your attorney, financial advisor, and CPA can all help you with this process.
- If you later want to change the beneficiaries of your trust or terms relating to their distributions, this can be done by simply amending the trust, rather than changing the designations on each individual asset.
- After your death, your trustee will have quick access to assets in order to pay debts, taxes, and other obligations of the estate.
Ultimately, each individual must make his or her own decision for his or her estate plan. Fear of a trust overly complicating that plan, however, should not be used to decide against it. For more information about creating an estate plan, we encourage you to sign up for our newsletter today.