Benefits of living trusts include avoiding the time and expense of probate and enabling the estate plan to remain private, reports About.com. Living trusts also allow the maker of the trust to maintain full control over the trust's assets as trustee, points out AARP. If the maker of a living trust becomes physically or mentally incapacitated, appointing a successor trustee in the trust document allows the assets to avoid conservatorship, according to Nolo.Continue Reading
Beneficiaries receive assets listed in wills after an expensive and time-consuming court procedure called probate, states About.com. Once estate plans reach probate court, they become a part of public records. In contrast, assets specifically titled in living trusts pass directly from the trustee to designated beneficiaries without going through probate. A living trust can specify that the successor trustee should pass on all assets to beneficiaries immediately when the trustee dies or distribute them periodically in installments, advises AARP. Living trusts can also stipulate methods of distribution that maximize savings on federal and state taxes.
Because wills only take effect after a person dies, they are not helpful in avoiding conservatorship if the owner of the assets becomes incapable of handling finances, points out About.com. Living trusts enable spouses, partners or other successor trustees to take over management of trust properties without the necessity of court intervention.Learn more about Investing