How to Prepare a Living Trust at Home

By Bryan Driscoll, J.D.

How to Prepare a Living Trust at Home

By Bryan Driscoll, J.D.

Estate planning is unfortunately not something that everyone thinks about. However, neglecting proper planning can be detrimental to your heirs. One document in the estate planning arsenal is a living trust. This document not only protects your assets, but it also helps your heirs avoid probate after death.

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After you die, probate can quickly eat away at your estate, thus reducing the amount of money or other assets your heirs receive. That is why it is crucial to engage in estate planning to protect your heirs. If you need more assistance, we can help.

What is a Living Trust?

A living trust is a document that you create specifically identifying your assets and possessions, and indicating who will get your assets when you die. You can be as broad as you wish or as specific as you wish, depending on how many different assets you own, i.e. home, automobile, furniture, jewelry, cash, stock, etc. After you die, the successor trustee will then distribute such items to your heirs without the time drain or expense of probate.

Avoiding probate is one of the greatest benefits of a living trust, as it can be rather expensive and often causes additional delays in the distribution process. By creating a living trust, you ensure that your heirs receive every item you own without delay.

How to Create a Living Trust

When creating a living trust, there are many things to be mindful of so to ensure it is valid. For this reason, we recommend using a trusted estate planning attorney to help you prepare this document.

If you want to create a living trust at home, you can. But make sure that you pay close attention to the below:

Revocable vs. Irrevocable Trust

When drafting a living trust, you'll need to decide whether you want it to be revocable or irrevocable. These terms are fairly self explanatory.

If revocable, then you can choose to either revoke certain terms in the trust or the document altogether. If irrevocable, then you cannot revoke the trust unless and until all heirs agree or if a court orders revocation of the trust.

Trust Preferences

Thereafter, you'll have to choose your primary trustee; it is common for people to choose themselves. You will also choose someone else as your successor trustee, who should be a trusted individual or business that will carry out the terms of the trust after you die.

It can also be common for people to choose a close family member or friend as their successor trustee, as they are certain that this individual will be someone they can trust to carry out their wishes after they die. However, keep in mind that there are businesses that offer this service; it might be beneficial to select an unbiased third party to prevent potential conflicts down the line.

Distribution of Assets

This is perhaps one of the most important items of consideration. When creating your living trust, you should be clear and specific. If you include any ambiguous terminology, it will be up to your successor trustee to interpret such ambiguity. In order to prevent this from happening, you'll want to draft a well written document.

Ensure that all of your assets and possessions are listed in the trust. Take your time when creating it, as this will be the actual document used after you die to distribute all of your belongings.

Execute the Trust

After you've drafted the trust, identified a primary and successor trustee, and determined whether you will have a revocable or irrevocable living trust, you're now ready to sign it. The requirements vary by state. Therefore, you should visit your state's Secretary of State website to find the local law concerning execution requirements.

Regardless of your state's legal requirements, you should strongly consider signing and dating the trust in the presence of two witnesses, both of whom should be non-heirs with no direct familial relationship to you. Although not required in many states, signing in the presence of a notary is also a good idea.

Transfer Title

The last step in ensuring your living trust is valid is to fund the trust, which is done by transferring title of assets into the name of the trust. This also ensures that your living trust helps your estate avoid probate after you die.

In order to do this, you will simply transfer title from yourself to the trust for all of your current assets, including your car, home, bank accounts, etc. Ensuring you've completed these steps will give you peace of mind knowing that your living trust is valid.

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not LegalZoom, and have not been evaluated by LegalZoom for accuracy, completeness, or changes in the law.