Establishing a revocable trust can yield many benefits, such as better control, privacy and reduced costs. It can sound too good to be true, but these advantages can be possible based on the situation, the estate’s size and asset types.
Revocable trusts are great options to avoid extensive probate procedures and their accompanying costs. But sometimes, they can be more troublesome than having an estate undergo probate. Revocable trusts can also have disadvantages, including the following:
- They can take more time and effort than other estate planning tools because of requirements related to transferring assets to the trust.
- They can be more pricey than other options, making it beneficial only if the probate expenses outweigh the upfront costs. There can also be trustee fees, depending on the arrangement’s details.
- Administering assets in a trust can lack supervision because there is no court review. This element can increase the chances of oversight or mistakes.
- Other estate planning tools can have better tax benefits than trusts.
Despite these downsides, revocable trusts can remain the better option, depending on your needs. This option can have other features and structures for asset and investment management, allowing you to address financial issues and integrate them into your estate plan.
Choosing the right estate planning tool
When deciding to establish a revocable trust or write a will, it can be beneficial to seek legal counsel first. Consulting a professional can also help you learn about your options based on your unique needs and estate qualities. Getting proper guidance can also help you use your estate plan to address financial and personal concerns that may arise before or after you pass on.