A trust is a private agreement made between the person who creates the trust (the “settlor”) and the person named to look after the property on the settlor’s behalf (the “trustee”). The most common estate planning document used as a will substitute is a revocable living trust. The “living” part of “revocable living trust” means that the trust is created while the settlor is alive (or “living”) and the “revocable” part of the name refers to the fact that the trust can be changed or revoked by the settlor while they are alive. Unlike a Will, a revocable living trust is a private document and upon the death of the settlor, the contents of the trust document will not be made public. A Will is by law required to be filed with the probate court after the death of the creator of the Will. Therefore, a Will, although usually kept private while you are alive, is required by law to become public after your death.
Privacy is a big reason that many celebrities and wealthy people choose to transfer the bulk of their assets to their heirs via a trust. In this age of TMZ and endless gossip websites, if a celebrity passes their assets via a Will, it almost guarantees that the tabloids will dissect that document once it becomes public. However, you do not have to be wealthy or famous to value privacy. The details of your life are kept private while you are alive; why not keep them private after your death? Many average Americans see the logic of this reasoning and choose to keep the details of their estate plan private after their death via the use of a revocable living trust.
In addition to privacy after death, a revocable living trust can also be used to keep the identity of ownership of certain real property out of the public eye. Instead of buying a piece of property for your residence or for a vacation home in your personal name, you could buy that property in the name of your revocable living trust, and on the tax rolls, that property would be listed in the trust’s name instead of your individual name. This can be another valuable privacy aspect to revocable living trusts that you can take advantage of while you are still alive.
Privacy is only one reason to consider a revocable living trust as part of your estate plan. There are many additional reasons to consider a revocable living trust in your estate plan, so stay tuned for future blog posts covering some of these reasons! In the meantime, if you have questions regarding revocable living trusts, or how one could be used in your estate plan, please do not hesitate to contact me.
The information contained herein is intended for informational purposes only and is not legal advice, nor is it intended to create an attorney-client relationship. For advice regarding a specific legal issue, please contact me or another attorney for assistance.