Trusts are commonly thought to be complicated, but in reality, trusts are often used to simplify matters. Think of a trust like a dish of candy. The dish is the trust itself and the candy is your assets – like your home, bank accounts, etc. You are the Grantor of your trust, the person who created it. You may also be the Trustee, the person who is able to reach into the dish and manage the candy. That could mean changing it from chocolate to peppermint, taking the candy out, putting new candy in, etc. You may also even be the Beneficiary, the person who gets to enjoy the candy.
Trusts can avoid probate. Since your assets are already inside your trust (your candy dish) when you pass away, your trustee can simply distribute the assets as you direct in your trust. With a will, generally you must go through probate before your executor can distribute your assets according to your will. A trust can be especially helpful if you own real property in another state.
Probate in Texas has become more expensive and more time consuming in recent years. For that reason alone, more and more people are choosing to create a trust instead of relying solely on a will for their estate plan. When done properly and probate is avoided, a trust-based plan is cheaper than a will based plan and probate.
Trusts provide better incapacity planning. Once your assets are in your trust, it creates a streamlined way to manage the things you own. This can be critical if you become incapacitated in the future. Your Successor Trustee can step into your shoes and manage your assets to best provide for your care.
Trusts are private. Because a trust does not have to be probated, what you own will not become public record through probate. Additionally, you may choose a trust name that does not contain your name for enhanced lifetime privacy. Your assets can then be owned under your trust name and not your name as an individual. So, other than your beneficiaries no one will know details about your assets.
Trusts give you greater control. Not only do trusts take the unpredictable burdens of probate court out of the mix, trusts also allow you much greater control over the when and how of who is getting your stuff. Your trust is your own rule book, and you can create any limitations or conditions you desire.
Whether or not a trust is right for you is a decision that you should make only after careful consideration with your attorney. Trusts can be wonderful tools, but only when done correctly.