Setting up a living trust is one way to have more control over how your estate will be finalised at the end of your life or in the event that you become incapacitated. A living trust is an established method of handing down your assets through a dignified and private process.
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Parties to a Trust
The granter is the person who sets up the trust. The trustee is the person who manages the trust. There can be more than one trustee, and the trustee can also be the granter, in case he wants to take part in managing his own estate. The beneficiary is the person who will receive the property from the granter. Sometimes the granter will make himself the primary beneficiary, along with other designated beneficiaries.
How a Trust Works
In a basic living trust, a granter transfers title of his property from himself to the chosen trustee or trustees. In the case of the death of the granter, the trustee then transfers said titles to the remainder beneficiaries.
Living trusts are set up in advance to cause less stress on the family. Also, if a person dies without a living trust or a will, family members will have to start proceedings in probate court to finalise the estate. This could take months or even years, but the entire process of transferring property with a living trust typically takes a few weeks.
Living trusts tend to be more expensive than wills, and the cost of maintaining them multiplies yearly. Tax advisers should be consulted in order to understand the tax costs.
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