Living trusts are often referred to as "living revocable trusts" or "revocable living trusts", because they are always revocable. Revocable means that the trust can be changed or withdrawn at any time. Living trusts will enable people to leave more to their heirs, while avoiding estate taxes and probate. In order to prevent a probate proceeding, a trust must be correctly set up and managed.
Most people who get a living trust do not avoid probate. There is a legitimate argument in the legal community against living trusts, because so many of them fail to give the probate protection that was "sold" to the family. The problem isn’t the trust. The way attorneys are educating their clients is the problem. In order to avoid probate, clients need to be educated on how to "use" their living trust.
When the living trust fails to protect the family against probate, the deceased’s assets need to be probated. That means the family has to go through a lengthy legal process at the probate court. A will helps guide the probate court through the probate. When there is no will, it becomes what is called an "intestate" proceeding. Intestate means that there isn’t a will.
When you get a revocable living trust, you should also get a pour over will. If for some reason assets need to be probated, the pour over will can be used by the probate court to guide the probate process. If all goes well, nothing will need to be probated and the pour over will won’t be used.
A pour over will does not outline how property is distributed in the same way a traditional will does. After the probate proceeding, the pour over will instructs the court to "pour over" all of the assets into the living revocable trust to be distributed as detailed in the living trust. Revocable living trusts and pour over wills are discussed in detail in Lee R. Phillips’ new book, Guaranteed Millionaire. Also order Lee's FREE DVD, "Using the Law to Make Money and Protect Your Assets".
