So what's a Living Trust and do I need one? - Wealth-Wisdom Wednesdays

What is a living Trust? A living Trust is an estate planning tool. It must be written to be valid. It is referred to as a living Trust because it is written and used while you are alive. It is also referred to as a revocable inter vivos trust.

Can a living Trust be changed in my lifetime? Yes so long as it is a revocable trust.

Do I need a living Trust? If you have any assets and you would wish for these assets to be held in trust for your beneficiaries you should give it serious consideration.

What assets should I include in my trust? The assets do not need to be listed in the trust document, however it is a good idea to have some sort of addendum to the trust so that the Successor Trustee knows which assets are being administered. It will certainly make their job easier and they will thank you enormously.

Who should I appoint as a Successor trustee? Any one you trust implicitly with your life and your assets. Choose wisely for they will have complete control of all your assets and you will not be around to question their actions

Which assets should I consider including in this list? Any property you own, life insurance policies, investments and savings and any other substantial assets you would like to pass to your beneficiaries when you are gone.

Do I also need a Will? Probably to 'sweep up' any other assets that may have been omitted from the Trust

What are the key characteristics of a Trust? A trust document must be written as a trust instrument and must contain the names of the Grantor, The Trustee, at least one Successor Trustee and the names of the Beneficiaries.

Is it expensive to create a trust? This depends on who you ask and how you choose to go about creating a trust. A deed of trust can be created and drafted by you or you may choose to hire a Solicitor to write it for you. Should you choose to ask a Solicitor, ensure you understand what you want from your trust otherwise this can be very expensive.

I've heard a Will becomes public in probate. What about a Trust? Correct. A trust is a private document outlining ownership of private assets.

Can a trust be contested? Yes, but only in Civil court. A Will on the other hand can be contested in the public probate court.

Once I have created my trust what next? You will need to finalise the transference of your assets into the name of the trust. Failing this, your assets may well become subject to Probate and this can be time consuming and costly.

Remember, this article does not constitute legal advise. You must always ensure you fully understand the legal rules and requirements before entering into any contract or undertaking. If in any doubt, always seek independent professional advice.