5 Reasons Why You Might Not Need a Living Trust

living trustA living trust is a way to avoid the hassles and costs of the probate court, and while it is certainly beneficial, it is not beneficial for everyone.

When you are examining your options for an estate plan, realize that not all options apply to everyone. Therefore, it is always best that you consult with an estate planning attorney. An attorney will review your assets and your wishes, then help you decide which components make the most sense in your specific situation.

While you wait for your consultation, here are a few reasons the living trust might not work for you.

5 Reasons a Living Trust Might Not Make Sense for You

Some people can benefit from establishing a living trust right now, while other times you can wait on the living trust or forgo it entirely. Here are five common reasons a living trust is not used – see which might apply to your situation.

Reason 1: Your Biggest Assets are Jointly Owned

You do not need a living trust if your largest assets are all jointly owned. That is because jointly owned assets will pass directly to the other survivor via right of survivorship – which means that your co-owner would automatically inherit the asset anyway.

Reasons 2: Assets with Beneficiary Designations Avoid Probate

If the rest of your assets have designations for your beneficiaries – such as investment accounts, bank accounts, life insurance policies, and retirement accounts – they would avoid probate court altogether. These assets which have named beneficiaries do not go through probate, and your loved ones are allowed to access them right away.

Reason 3: You are Young and Middle Income

A living trust does not usually make sense for anyone in the mid-income range that is under 55 or 60 years old. That is because a living trust doesn’t do anything for you while you are alive, and there is not much reason to worry about one when you are in your 20s, 30s or even 40s.

Reason 4: Simple Estates Often Go through Probate without Issue

Most states now offer streamlined probate court processes, especially for smaller estates. In New York, estates that are classified as “small” will go through the quicker process, which costs less and takes significantly less time too. Therefore, if your estate is already “small” in the eyes of the state, your loved ones would not have the costs or time hassles of the traditional probate court process.

Reason 5: Your Assets are Not in the Millions

The biggest reason living trusts do not make sense is when the estate is small – such as $300,00 or less. However, if you were 45 years old and have an estate worth $1 million or higher, you may consider a living trust.

Consult an Estate Planning Attorney in Long Island, New York First

While these reasons might apply to you, you must realize that every estate is unique and the process of drafting an estate plan is highly complicated. Therefore, your estate may need a living trust even when you may think it is unnecessary, or you meet any of the conditions cited above.

To see if you could benefit from a living trust, contact the Law Office of Andrew M. Lamkin, P.C.

You may schedule your free case evaluation at 516-605-0625, or contact us online to schedule your appointment.

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