What Are The Advantages Of A Revocable Trust

Choosing the right technique to ensure a smooth transition in the ownership or control of a property can offer piece of mind. A revocable trust is a preferred option for many people because it allows them to oversee this process while the grantor is still alive. A revocable trust also offers other benefits that some consider advantageous over a will. Of course, planning for events after one is gone is not something that everyone wants to think about, especially younger individuals, though a revocable trust does manage to bridge some issues that people have with last wills and testaments.

What Is a Revocable Trust?

There are different types of trusts and, in fact, trusts are commonly encountered in the financial industry. Trusts can also be used by individuals who are interested in accomplishing much the same tasks as a last will and testament. Indeed, revocable trusts are often contrasted with wills in order to demonstrate some of the ways that revocable trusts stand out.

One thing that is important for men and women considering revocable trusts is to keep in mind is that they are revocable, giving them a leg up over irrevocable trusts. Laws pertaining to revocable trusts will also differ in different jurisdictions in the United States.

General Benefits

Although the benefits of revocable trusts will be discussed in more detail later, one advantage of this technique is that it allows the grantor, the person creating the trust, to also benefit from the trust while they are still alive. This can be contrasted with the case of a last will and testament, in which the terms of the will do not take effect until the demise of the writer of the will. Revocable trusts, as the name implies, also give the grantor the flexibility of “changing their mind” should they decide later that the trust was not all that it was cracked up to be, or circumstances necessitate a change in plans.

In general, a trust is a relationship in which a property is transferred from one party to another for the benefit of a third party, known as the beneficiary. Revocable trusts are unique not only in that they can be canceled or revoked, but in that the trustee, the party to whom the trust has been transferred, can also be the grantor.

In this case, a co-trustee is ordinarily appointed for a number of reasons, not least of which is to be able to administer the trust property in the event that the grantor becomes mentally incapacitated or otherwise unable to perform their duties as trustee. This may be a little confusing but should become clearer as we examine the issue more closely.

Trust Law and Other Types of Trusts

  • Some of the key aspects of a revocable trust become clearer when trust law and other types of trusts are examined. There are three terms that are important to understand in learning how trusts are created and how they work. These terms are:
  • Trustor: also called the settlor or grantor, the trustor is the first party who settles the property on the second party
  • Trustee: this is the second party upon whom the property has been settled
  • Beneficiary: the beneficiary is the party on whose behalf the property is administered
  • Trust deed: the document that defines and clearly names the above-mentioned roles and the property

In the case of a revocable trust, the grantor (or trustor or settlor) creates the trust and may be able to name themselves of a trustee depending on their jurisdiction. Whether as grantor or as trustee, they retain certain rights over the trust, including the ability to direct how the trustee uses funds and the ability to revoke the trust. Trusts normally involve transfers of property, often to protect the grantor from loss of the property or for tax reasons. The ability of a grantor in a revocable trust to retain much power over their property renders revocable trusts both unique and unusual.

Other Types of Trusts

There are other types of trusts that are frequently encountered both in the financial world and in situations of death and division of property. In reality, trusts existed in ancient times and as English customary law is derived from Roman law, the present understanding of trusts that exists in English-speaking countries today is a legacy of the ancient practice. Other common forms of trusts include:
  • Discretionary Trust
  • Land trust
  • Offshore Trust
  • Public trust (charitable trust)
  • Testamentary trust

The Probate Issue

The term probate refers to the legal process by which a last will and testament is accepted by a court, or the process by which the property of someone who dies intestate (without a will) is administered. An easy way to remember what probate means is that it is the process by which the testamentary document (the will) is proven by the court. The reason why probate is important here is that all last wills and testament involve a court in some regard. Furthermore, if a person dies intestate, then probate is also involved, as already mentioned.

Revocable trusts are unique in that they do not require probate involvement at all. The trust established during the lifetime of the grantor who the trustee and the beneficiary are, privately, and the involvement of probate is not needed. Also, wills registered with the court are public record, meaning that the assets and the named individuals are also public record, whereas a revocable trust is a private matter and only the involved individuals and their counsel would be party to the specifics of the trust.

How Are They Used?

Many people think of trusts as a way to avoid taxes or to protect property in situations where an individual has some sort of financial liability. Indeed, trusts were commonly used in the United Kingdom in the wake of the land acts of the early 20th century to protect large landholdings from the death duties that were instituted to break them up. A death duty (a tax on property levied after someone has died) often necessitated the sale of property, but if the property was transferred before the individual died or placed into trust, the death duty could be avoided.

Although revocable trusts are not quite the same as these other types of trusts, they do accomplish the goal of ensuring a smooth transition of property prior to the demise of the property owner. Revocable trusts are seen as alternatives to last wills and testaments because they do allow you to provide for your upkeep should you become ill or otherwise incapacitated during your lifetime. A will would only take place at the time of your demise. A revocable trust would also allow you to do away with the trust should you no longer find that a trust is necessary.

Illness

Some revocable trusts do not automatically address the issue of illness or incapacity, so individuals worried about this situation should make sure that their trust includes language that covers it. In cases where individuals become ill or incapacitated and do not have a trust, the court ordinarily has to appoint a conservator or guardian to manage their finances and other concerns on their behalf.

A revocable trust therefore accomplishes the tasks of providing for your property while you are alive while also providing for you should you become incapacitated. It is important to note that it may be important to have a will in addition to a trust.

What Are the Advantages of a Revocable Trust?

There are many advantages of revocable trust compared to a will. Although revocable trust property can be taxed (even though it is in trust) and the property in the trust is not protected from creditors, a revocable trust does have some features that give it a leg up over a will. Here are some of the major advantages of this type of trust:

  • Multiple copies avoid the situation of locating the original will document
  • Probate not needed in a revocable trust
  • Investments are not interrupted by death or disability
  • Assets immediately available without the need for a probate court action
  • Privacy
  • Ability to revoke the trust at your discretion

A trust of this type is therefore able to accomplish some of the functions of a last will and testament while avoiding some of the inconveniences, such as delays due to involvement of the court, disputes regarding the will, and assets not immediately being available due to various factors. As mentioned, most people choose also to have a will to deal with such issues as guardianship of minor children or other issues that would not be part of the trusteeship. Therefore, a trusteeship of this type can be used to provide both practical benefits and peace of mind to the grantor.

Conclusion

Let’s face it, no one wants to spend too much time thinking about their own demise, but addressing this eventual reality will allow both you and your family to be prepared financially when the time comes. Wills are important and necessary, but they do have their drawbacks. A revocable trust allows an individual to provide for their beneficiaries and even for themselves should they become ill or incapacitated.

Types of Lawyers: Your Guide To Finding the Right Lawyer

Finding the right types of lawyers or attorneys for your case is important. Cases can last months or even years, and you will probably need to be in regular correspondence with your lawyer. There are many types of lawyers. Some are highly specialized while others may handle a wide range of cases. Different types of lawyers’ fee structures will differ.

Choosing a lawyer is a highly personalized decision and there are likely to be many choices in your area. Usually, lawyers’ geographic areas determine to some extent what kind of law they practice. A lawyer in a small town will probably have more of a general practice while lawyers in urban areas will be more specialized. Sometimes a lawyer will decide he or she can handle all of a clients’ needs; at other times he or she may send their client to a specialist.

Some law firms focus on one specialized area of law, such as intellectual property. Other law firms comprise several lawyers whose practice areas complement one another. For example, Lawyer A would focus on one practice area such as Real Estate, Lawyer B would practice an area such as Estate Planning, and Lawyer C would focus on litigation and trial work. This loose collection of specialists would be called a general practice law firm.

You can always find more information about a lawyer by visiting their website or by calling them. Most types of lawyers offer free consultations where you can get a feel for them before starting payment.

Types of Lawyers

There are multiple factors to consider when talking about the different types of lawyers out there. It depends on the case and your budget, for starters. The best-connected lawyers with stellar track records will command a higher price. They will probably have offices in downtown office buildings and have great views. The size of the law firm may determine how much personalized attention you get. If you are a small client at a firm that deals mostly with big-name corporate clients, you may get lost in the shuffle.

There are many types of lawyers for all different cases. However, most lawyers fall into two categories; they practice either civil law or criminal law.

1.Criminal Law Lawyers

criminal-lawyer-in-eaton

Criminal law pertains to people who have been accused of committing a crime. Lawyers work as criminal defense attorneys to protect your rights and make sure you get a fair trial. They represent you and are with you every step of your case. They help you in cases against a person, like assault and battery, cases against property, such as burglary or arson, or any other criminal offense. If you are accused of a crime, it is imperative to find a competent criminal defense attorney.

2.Civil Law Lawyers

civil-law

The second type of lawyers deal with civil law. Civil law covers an array of specialization. These are some types of lawyers who practice civil law and their specialties.

PUBLIC INTEREST

ESTATE PLANNING

FAMILY

IMMIGRATION

PERSONAL INJURY

How Do I Know Which Kind of Lawyer I Need?

The types of lawyers you should look for depends on your case and its complexity, where you live, and what you can afford. We recommend you search online for the best types of lawyers near you on sites such as www.avvo.com. With Avvo, you can search for lawyers near you by practice areas.

Avvo.com creates ratings for the lawyers on their sites from information taken from their profiles, information from state bar associations, and other organizations that license legal professionals. Avvo only provides ratings for lawyers whose profiles have been claimed. Otherwise, they do not provide a numerical rating. However, 97 percent of lawyers in the United States are rated on Avvo.

How Are Avvo Ratings Determined?

Avvo ratings, which are scored 1-10, are based on the lawyer’s experience and background, their legal community recognition such as peer endorsements, associations, awards, and legal thought leadership track records including speaking engagements and publications. All factors affecting a lawyer’s Avvo rating are visible. You can also read reviews of your prospective lawyer on Avvo from past clients.

What to Look for in a Lawyer

1.Positive Rapport

It is very important that you feel comfortable with your lawyer. Honesty is key. Your lawyer can best help you when you give him or her complete and accurate information. Your lawyer’s job is to represent you. Trust and an open line of communication between the two of you is very important. Changes to your case may come at any moment, information may be required of you, and it is possible you will need to be in regular contact with this person, especially if it’s something like a divorce case.

2.Availability and Response Time

You can feel out your prospective lawyer’s availability before you sign a contract by sending a few phone calls and emails to see how fast you get a response. If your concerns and questions are addressed quickly, then you may just have found the right lawyer for you.

3.Track Record

You can search any prospective lawyer’s name online to see what has been said about him or her. You can check your state bar association’s website to see if any complaints have been lodged against your prospective attorney.

You will want to ask about whether they have handled this type of case before and what the outcome was. Less-experienced lawyers will come at a lower cost. Lawyers with the best and most experience will come at a higher cost.

4.Fee Structure

You want to be clear on how you will be charged for their services. If it is a small legal matter, you likely need not use the services of a high-powered litigator. Smaller matters may be better handled by a lower-priced attorney. Some attorneys offer a flat fee structure while others will bill by the hour. Besides the work on your case, time spent corresponding about your case (such as phone calls and emails) are often also billed. Lawyers who bill a flat fee may charge for additional costs such as the cost to file court documents. It is important to get clarity on these matters before proceeding. Small costs can add up.

Conclusion

As you can see, choosing the best types of lawyers for your needs can be simple. Use online resources to get all the best, up-to-date information on types of lawyers near you. Don’t get lost in the shuffle with a high-powered attorney who doesn’t have time for your case when you need a personalized, hands-on approach. The right types of lawyers out there will see you and your case as important—not as just another case number on the docket.