One of the most overlooked benefits of a revocable living trust is its flexibility and efficiency in providing the means and people necessary to provide for your care if you become sick, disabled or otherwise incapacitated. Recent studies suggest that upwards of 27% of Americans currently suffer from a disability, and with our population quickly ageing, this number may increase in the future. As such, it is critical that your estate plan addresses and protects you during the health, disability and incapacity challenges life brings.
A Revocable Living Trust is one of the most effective tools for incapacity planning. This blog post explores five critical benefits of a trust-based estate plan in planning for incapacity.
1. Comprehensive Control
Revocable Living Trusts offer an unparalleled level of control regarding incapacity planning. When you create a trust, you will initially designate yourself as the trustee, retaining complete control over your assets and decision-making. In the event of incapacity, a successor trustee of your choosing can seamlessly step in to manage your affairs according to your wishes. This provides a level of continuity and control that other incapacity planning tools may not offer, particularly when combined with other estate planning essential documents such as a living will, Health Care Surrogate Designation and a Durable Power of Attorney.
2. Avoiding Guardianship/Conservatorship Proceedings
If you become incapacitated without a revocable living trust or proper planning, the court may need to appoint a guardian or conservator to manage your affairs. This process can be lengthy, costly, and intrusive, involving public court hearings and ongoing oversight. By establishing a trust, you can generally avoid guardianship proceedings, ensuring that your chosen successor trustee manages your affairs without court interference and often significant delays.
3. Privacy
Trusts provide privacy and confidentiality that other planning tools may not offer. When assets pass through a will, they become part of the public record through probate. Trusts, on the other hand, typically remain private. This confidentiality can be crucial for those who value their financial privacy and wish to keep the details of their estate and incapacity plans away from prying public eyes.
4. Customization
Trusts are customizable, flexible, and can be tailored to your needs and goals. For example, you can include detailed instructions on how you want your assets managed, how your medical and financial decisions should be handled, and when or under what circumstances your successor trustee should take control. Be sure to consult with an experienced Tallahassee Estate Planning Lawyer to help design an estate plan aligned with your values and preferences.
5. Continuity of Financial Management
Incapacity planning with a revocable living trust ensures that your financial affairs continue uninterrupted. Bills can be paid, investments managed, and important decisions made without delay, helping to maintain your financial stability and well-being during incapacity. Often, the court guardian or conservator process can take a significant amount of time to conclude, which can cause considerable damage to your finances and strain your loved ones.
Incapacity planning is a vital aspect of a comprehensive estate plan. Revocable Living Trusts are one of the best vehicles for the job as they can provide unmatched control, privacy, and customization and enable you to plan for incapacity to reflect your needs and wants. Consult an experienced estate planning attorney to create a trust-based incapacity plan that suits your needs.
