A Living Trust consists of House(s), Cars, Bank Accounts, Proceeds of Life Insurance, Retirement Plans basically all of your assets go into your Living Trust. Once all the assets are in that Living Trust, which is during your lifetime, you have complete control of those assets. The Trust can be controlled by a Husband/Wife or a sole person (Signature Authority).

Upon death, the successor trustee enters immediately into authority over the asset which avoids probate. Now what happens to the assets that the control has been taken over is in the Trust agreement, you designate beneficiaries; which can be charities, children, educational programs, and trusts for other people, trust distributions, etc. For example, if you have young children, without a Will or Trust the children at age 18 get the entire distribution with Life Insurance, the proceeds could be substantial, millions of dollars could be involved.

Instead the trustee is given the authority to designate the beneficiary’s amount and time frame for receiving benefits. Payments can be designated for medical, educational or for lifestyle. The benefits can also be broken up through the years or ages the children reach. So through a Living Trust, upon death, we get the assets, take control through a successor trustee, which there can be many in some cases. There is also the issue of Guardianship of children. You will need to designate a mature individual with guardianship and a trustee for financial management, never one person for both matters.

The consequences of not planning could be devastating. The wrong person could take control of the assets, in these cases; we set up a committee of financial trustees. As a married couple there are successor trustees for each other. A 2nd level of trustees can be children and if they are too young, it can change to family members.

The Living Trust takes place upon death, no what happens during the lifetime. There is an interim document called a “Durable Power of Attorney”, now this document gives you the power to act as a financial advisor for assets which can include bank accounts, property, bills, real-estate and business. This document gives a list of powers to the designated agent. So from the Durable Power of Attorney upon death, the Living Trust takes effect. Trusts can be simple or complex, it is a customized plan. The best time to plan a trust is when you don’t know it’s needed. The worse time to set up a trust is when there is an emergency; a rational frame of mind is needed to make critical decisions.

A Living Trust is a private document, which is needed to be planned and put together in a formal, professional setting. In a trust, you are needed to make medical decisions as well. These decisions could include issues regarding life support and coma. The worse time to make these decisions is when there is an emergency. You can create a Living will for Health care which is very important. This document can indicate certain health care wanted, designate their wishes, etc.