Living Trust 101 – California Estate Planning

Living Trust 101: What You Need to Know

Why Choose a Living Trust?

If you’re looking for a flexible and effective way to manage, protect, and distribute your assets, a revocable living trust could be the solution. More people are opting for wills and trusts because they’re a straightforward tool for ensuring your family’s future is secure.

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What Is a Living Trust?

A living trust is created while you’re alive and lets you transfer ownership of your assets to yourself as the trustee. Since it’s “living,” it kicks in right away, allowing you to enjoy the benefits without losing control of your assets.

You can make changes to the trust anytime, such as updating beneficiaries or transferring assets back to your name, all without tax complications. Plus, it’s a private arrangement—unlike a will, the details won’t be subject to public probate proceedings.

Key Benefits

• Flexibility: A living trust can adapt to your family’s unique needs. You’re in charge as the trustee, with no extra management fees. Change beneficiaries, add or remove assets—all without tax headaches.
• Control: Keep full control of your assets during your lifetime. You can buy, sell, or gift assets without restrictions. The trust only becomes irrevocable upon your passing.
• Incapacity Planning: You can name a trusted person to step in as a successor trustee to manage your affairs if you’re unable to, avoiding the need for court-appointed conservatorships.

Save on Estate Taxes

For married couples, a living trust can significantly reduce or even eliminate estate taxes with proper planning. This is especially valuable in states with their own estate taxes. A trust also ensures that the deceased spouse’s share of the estate ultimately goes to their chosen heirs, even if the surviving spouse has full access to the assets during their lifetime.

Skip Probate

One of the biggest advantages of a living trust is avoiding probate. Probate is a time-consuming and costly court process where your will is validated, debts are paid, and assets are distributed. With a living trust, your assets can be distributed to your beneficiaries immediately and privately.

Protect What is a Beneficiary

A trust offers the ability to manage and distribute assets to minor or adult beneficiaries on your terms. For example, you can stagger distributions, such as one-third at age 25, another at 30, and the remainder at 35. If you’re concerned about a beneficiary’s financial habits or external risks like lawsuits, the trust can hold the assets indefinitely for their benefit.

Cut How much does probate costs?

Probate can come with hefty executor fees, attorney fees, and court costs, which are usually based on the value of your estate rather than the actual work involved. A living trust allows you to sidestep these costs, leaving more for your beneficiaries.

Manage Ancillary Probate / Out-of-State Property

If you own property in another state, a living trust eliminates the need for additional probate proceedings in that state, simplifying the process for your heirs.

Additional Features

• Pour-Over Will: Ensures that any assets not included in the trust during your lifetime are transferred to the trust after your death.
• Creditor Protection: A living trust can shield assets from creditors and lawsuits, providing peace of mind for both you and your beneficiaries.
• Continuity of Management: Your trustee can step in immediately to manage the trust’s assets, ensuring a seamless transition without delays or disruptions.

Essential California Estate Planning Documents

Living Trust

This document sets the foundation, transferring assets to the trustee for management and ensuring your wishes are followed during your lifetime and after.

California Declaration of Trust

A backup document to include any overlooked assets in the trust, helping you avoid probate.

California Certification of Trust

A summary of the trust used to confirm its existence and your authority as trustee without disclosing private details.

California Assignment of Personal Property

Transfers items like furniture, jewelry, or digital assets into the trust, avoiding probate.

California Advance Directive

Allows you to appoint someone to make medical decisions for you if you’re unable to and provides guidance on your end-of-life wishes.

HIPAA Authorization

Ensures your trusted individuals can access your medical records when needed.

California Final Disposition Instructions

Lets you specify your preferences for burial or cremation and other post-death arrangements.

Why Now?

Creating a living trust is a proactive step to protect your loved ones and simplify the management of your assets. It’s a customizable, private, and cost-effective tool that gives you peace of mind. With so many benefits, there’s no reason to wait.

CA Wills and Trusts
Janet O’Neal, Certified Estate Planning Specialist
Fresno Co. Registration No. X201210000012
Office: (833) 500-2009

Let us help you take control of your estate planning today!