If you have assets you would like to transfer to your children, grandchildren, or other loved ones after you pass away, you may consider creating a revocable trust to make the transfer process easier.
A trust allows you as the grantor to place certain assets in the trust and name a successor trustee to distribute the assets within the trust when you pass away. You have several types of trusts to choose from depending on your needs.
Colorado residents may choose to create a revocable living trust for several reasons, including:
- Ability to make changes: The grantor can continue to make changes to the trust throughout their lives. They are even allowed to shut down the trust if they no longer need it.
- Protect assets from probate: Assets placed within the trust are protected from the probate process. This means that your beneficiaries can receive their assets without going through a lengthy and expensive court process.
- Protecting privacy: Anything contained in the trust is not a part of the public record. Only beneficiaries and taxing entities will need to be made aware of what is within the trust.
- Long-term protections: The grantor has the flexibility to add conditions to the trust to ensure that the assets included in the trust are protected. You will also be able to protect and manage your assets if you ever become incapacitated.
Keep in mind, however, that there are generally no estate tax planning benefits that come with a revocable trust.
The estate planning process can be complicated, particularly if you include a trust in your plan. However, a revocable living trust may be a solid option for you, even if you already have a will.