Making your house into a living trust is easy. All you have to do is change the title of your home and sign a new deed. Of course, real estate is the most beneficial asset to put in a trust, but you should also include stocks, CDs, bank accounts, and insurance policies.
Steps to creating a living trust
You can take a few steps when you create a living trust in California. The first step is to identify your goals. They may involve avoiding probate and planning for capacitating conditions.
The second step is deciding what assets to place in your living trust. You may wish to transfer only your most valuable assets into the trust. For those with a modest estate, you may want to share your property with your spouse. In that case, the probate process will be faster.
Cost
The cost of a living trust depends on how it’s set up. Many families choose to hire an attorney, but some choose to do it themselves. While do-it-yourself trusts can save money, it comes with risks. An attorney specializing in trusts will likely charge less than $1,000.
A living trust can cost anywhere from $599 to upwards of $2,000. Legal and other fees can add up, and a living trust agreement can be time-consuming and costly. You’ll also need to re-title your assets before transferring them into the trust. This process can take a while, especially for people who are not experienced with legal documents. It’s important to remember that if your assets are not correctly titled, they’ll likely go through probate, and this process can be expensive.
Revocable nature
A revocable living trust is created by a person who assigns trustees to manage their estate. The grantor of the trust, also known as the “grantor” or “settlor,” names a trustee to oversee the trust assets and distributions to beneficiaries. This type of trust remains private until the grantor dies, at which point it becomes irrevocable.
One significant advantage of a revocable living trust is that it avoids the probate process. The process of probating a last will involves the admission of the document to the Surrogate’s Court, which costs money and delays the inheritance process. Using a revocable living trust can avoid the hassle of going through this process and prevent a lot of costs and time.
Adding real estate to a living trust
Adding real estate to a living trust can be complicated. Some properties, such as vehicles, can be challenging to keep in a living trust. Some lenders and insurance companies may be unsure whether to accept a vehicle into a living trust. However, other property can be added to a trust, such as a valuable antique car or a mobile home attached to the land. If you have these assets, you can discuss them with your estate planning attorney.
Adding real estate to a living trust can help you avoid probate. Probation is a lengthy process requiring a lot of money and time. Probate can take months or even a year to complete and cost anywhere from three to seven percent of your estate. Additionally, adding real estate to a living trust is particularly useful if you own properties in multiple states. Each state has its probate procedures and laws.
Adding a successor trustee
If you plan to name a successor trustee to manage your estate after you die, you need to choose someone with knowledge and experience in trust matters. In addition, the person must be able to fulfill a trustee’s duties and respect the trust’s preferences. Otherwise, you might be liable for extra taxes or mistakes made by the beneficiaries.
If you are unsure about your abilities, you should ask an attorney for assistance. A lawyer will help you decide who will best fulfill your duties. As a trustee, you’ll also need to check with the institutions to see their minimum requirements and whether they charge for management.