A living trust is simply a trust that you set up while you are still alive. Once you die or become incapacitated, a trustee of your choosing will have the power to make decisions regarding your trust. This allows you to have more control over your assets, both while you are here and when you are not, instead of leaving your decisions up to a probate judge. There are three key things to think about when considering a living trust.
Decide whether or not you want to appoint a trustee to oversee your assets, if and when you become unable to do so. This person will be given full authority over the trust, so it is important to choose a neutral third party who won't stand to gain from controlling your assets. For example, you might want to choose a lawyer, rather than a family member, to be your trustee.
Determine how important it is for you to control the allocation of your assets, rather than relying on the probate process. A living trust will allow you to do just that, to ensure that your assets will be left to exactly whom you would like. You will most likely be able to avoid probate completely, if you decide to make a living trust.
Establish how important it is for you to protect your loved ones from estate taxes and others who may try to seize your assets after you pass on. This is another benefit of a living trust, since probate can often leave loved ones with 60 percent or less of your assets.