This article is intended for educational purposes only and is not legal advice. For guidance on your personal situation, please contact a lawyer.

Estate planning isn’t always a walk in the park, but it’s well worth the effort. It’s a way to ensure your wishes are being properly honored.

When it comes to passing on an inheritance to your loved ones, you have several options. One of the more popular is using a living trust.

A living trust is a legal arrangement in which you put assets into a trust and specify how you want them distributed after you pass away. It’s not the best route for everyone, but it has great benefits that make it worth considering. Let’s take a look at the three main ones.

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1. You don’t have to go through the probate process

When it’s time for a will to be executed, it goes through a process called “probate.” During probate, a court ensures a will is authentic and then oversees the distribution of those assets to make sure it happens fairly and the assets end up in the right hands.

On one end, having a court oversee the process adds a layer of security and accountability. On the other end, the probate process is sometimes known for being time-consuming and expensive. The time varies by case, but it’s not farfetched for it to take months to years to complete, with likely no access to the estate’s assets during that time.

Probate costs are typically set by state guidelines, such as set percentages of the assets’ values. In California, for example, if the gross value of your estate is $1 million, you’d pay around $23,000 in executor/administrator fees:

• 4% on the first $100,000 ($4,000)
• 3% on the next $100,000 ($3,000)
• 2% on the next $800,000 ($16,000)

When you use a living trust, you can completely avoid the probate process because the assets are already in the trust, and managed and distributed according to the terms already set.

2. Living trusts provide more privacy than a will

Another downside of the probate process is that the details of a will become public information anyone can access. They could see what was left behind, the value of assets, who receives them, and other relevant details that could present a problem for people who’d rather keep a private profile.

For example, there have been plenty of instances where families have feuded because they disagreed with what assets were left behind and how they were chosen to be distributed. There have also been occasions when financial predators prey on younger people who come into a large sum of money.

Thankfully, the details of a living trust don’t generally become part of the public record. This privacy alone makes some people prefer going the living trust route.

3. Living trusts allow you to make adjustments if you need to

A living trust is also known as a revocable trust because it can be completely revoked or changed while you’re alive. This flexibility comes in handy for people who may experience significant life changes that warrant an adjustment (or revocation) of a living trust they have in place.

People have additional children, get married or divorced, lose or acquire a large sum of money, and experience other notable circumstantial changes. Whatever the case, having a living trust that can be relatively easily changed can be handy.

A simple amendment is usually all that is needed to make minor changes, such as removing or adding a new beneficiary. However, for more substantial changes, like changing how assets are distributed, the living trust may need to be completely redone.

Whatever the case, you always want your estate plan to reflect your current situation and desires, and a living trust affords you the flexibility to ensure that happens.

Remember: If you are considering a living trust, consult an estate planning attorney to see if it makes sense for your situation. It’s not the ideal route for everyone.

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