Living trust

Living trusts are an efficient and effective way to transfer property, at your death, to the relatives, friends charities you’ve chosen. Essentially, a living trust performs the same function as a will, with the important difference that property left by a will must go through the probate court process.
In probate, a deceased person’s will is proved valid in court, the person’s debts are paid and, usually after about a year, the remaining property is finally distributed to the beneficiaries. In the vast majority of instances, these probate court proceedings are an utter waste of time and money.
By contrast, property left by a living trust can go promptly and directly to your inheritors. They don’t have to bother with a probate court proceeding. That means they won’t have to spend any of your hard-earned money (at least, I presume it was hard-earned) to pay for court and lawyer fees.
Some paperwork is necessary to establish a probate- avoidance living trust and transfer property to it, but there are no serious drawbacks or risks involved in creating or maintaining the trust, You don’t even need to maintain separate trust tax records. While you live, all transactions that are technically made by your living trust are reported on your personal income tax return.
These trusts are called “living” or sometimes “inter vivos” (Latin for “among the living”) because they’re created while you’re alive. They’re called “revocable” because you can revoke or change them at any time, for any reason, before you die.
While you live, you effectively keep ownership of property that you’ve technically transferred to your living trust. You can do whatever you want to with any trust property, including selling it, spending it or giving it away. Basically, a revocable living trust is merely a piece of paper that becomes operational at your death. At that point, it allows your trust property to be transferred, privately and outside of probate, to the people or organizations you name as beneficiaries of the trust.