This is the first installment in a series of titled “What are the tools used in Oklahoma Estate Planning?”
Today, we start with the Living Trust.
The living trust is also know as a “revocable trust” a “revocable living trust”, an “inter vivos trust”. What is a trust? Simply put,
A trust is an arrangement under which one person, called a trustee, holds legal title to property for another person, called a beneficiary. With the revocable living trust, you can be the trustee of your own trust, you keep complete control over all property held in trust but get the benefits of the law treating the trust as a separate legal entity.
The advantage of having all of your assets held by a revocable trust at the time of your death, or at the time of your disability or incapacity are:
- Elimination of the probate process. This means that there would not be any court oversight of your estate. Since there would be no Court filings, there would be no public access to, and/or knowledge of, your assets and their value. Additionally, eliminating Court oversight would avoid the expense and delay associated with having assets administered by the probate process.
- Immediate and continuous access to assets and to cash flow. Without a revocable trust (or other appropriate estate planning device), assets would have to flow through the probate process. If assets flow through the probate process, access to assets and to cash flow is usually delayed due to the need to obtain Court permission.
- Protecting your assets and providing a continuous cash flow in the event you become mentally or physically disabled or incapacitated prior to your death (where the disability or incapacity prevents you from administering your own assets).
- Reduces the burden on the children and other family to search and gather assets after death.
- Provides the opportunity to gather and index all your financial documents together; that way your family will know what accounts you have and where.
- Reduces the chance of contest to your estate plan because it eliminates the chance for a will contest since the trust is the primary vehicle for managing and transferring property.