Is there a downside to a revocable living trust? Today’s question comes from a conversation attorney Sarah Siedentopf recently had with one of her estate planning and probate clients.
VIDEO TRANSCRIPT
Is there a downside to a revocable living trust? A client asked me this the other day and it’s an important question that I think a lot of people are wondering about. I’m Sarah Siedentopf. I’m an estate planning and probate attorney in Atlanta, Georgia, and if you have questions about this, please give me a call.
I had to think for a moment. Is there a downside to a revocable living trust? Because I had just gotten done explaining that the client was going to be the grantor. The client was going to be the trustee. The client could amend the trust, take things in and out of the trust, sell things, get rid of the trust, change the beneficiaries — do everything almost exactly in the same way that they would do it if they owned the property outright, just signing their name a little bit differently.
So when the client asked me, “Is there a downside?” I had to think for a second. Of course, there are always some downsides. Doing a trust is more expensive than doing a will. It’s not more expensive than going through probate, but it is an upfront expense right now. So there is an expense. You have to keep up with it and not so much that you have to keep up with the trust, but you have to make sure that things get into the trust in order for the trust to be effective. If you don’t transfer your house into the trust or transfer an account into the trust, it won’t be there. If you don’t use it properly and think about it, it won’t be effective.
So, yes, there’s a little more work that goes into a trust. But no, I really don’t think there’s a big downside that you can point to with revocable living trusts.
Now, this is certainly different than many other types of trusts, certainly irrevocable trusts. There are tons of downsides and, of course, in the right position, there are tons of upsides.
But for a living trust that is revocable, and you are the grantor, and you are the trustee, there really aren’t many downsides. So I was happy to be able to tell the client that. If you’ve got questions about whether there are downsides in your specific situation, please give me a call. Also, I would love to have your comments. Thanks.
To learn more about Revocable Living Trusts, you can read our blog Revocable Living Trusts: Improving Quality of Life Through Peace of Mind.
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