Are you writing a living trust in the Port St. Lucie area? Setting up a trust can be daunting, especially when you hear about common mistakes that others make! But as an estate planning and elder law firm dedicated to your success, we’re here to help you reduce stress and increase clarity throughout the process of setting up your living trust.
What Are the Benefits of a Living Trust?
A living trust means that you transfer your property before your death so as to potentially avoid probate at the time of death. You appoint a successor trustee to handle the trust and simply transfer ownership to the beneficiaries you named after your death. In some cases, the whole process might only take a few weeks. If your successor trustee is knowledgeable enough the property left through the trust doesn’t have to go through probate court, meaning that lawyer and court fees can be avoided if the successor trustee is knowledgeable enough to handle any potential legal complications. Sometimes when the trust contains real property, appropriately clearing the title after the death of the owner might require professional assistance. Even if that is the case, the key is to understand that your successors are not locked into the law firm who prepared the trust and can shop for professional assistance at a reasonable price When all of the property has been transferred to the beneficiaries, the living trust ceases to exist (unless a continuing testamentary trust is drafted and desired).
Even if you understand the benefits of a living trust, that doesn’t mean you necessarily feel confident in starting the process. Simple mistakes can interfere with and even invalidate what would otherwise be a simple transfer of property. Keep reading to understand five common mistakes that are often made when setting up a living trust and how to avoid them!
- Failure to Show Intent to Create a Trust
Because Florida courts are very protective of property rights, showing your intention of creating a trust is critical. You must prove your intention to give up control of property or assets for the express benefit of another person. However, the intention behind a living trust must be very specific: you must clearly state that you intend for the property in question to be used for a living trust. Technically you’re not giving up control during your lifetime since you will normally be the trustee and, moreover, you have retained the right to revoke the trust.
- Failure to Sufficiently Fund the Trust
The existence of a trust depends on the conveyance of property, you must actually transfer the property in order to create the trust. If you do not transfer the ownership of the property before death, property titled in the individual name of a decedent must be administered through the probate process.
- Failure to Instruct Beyond Precatory Language
Precatory language usually includes statements that merely express a wish instead of creating a legal obligation, according to Merriam-Webster. It’s important to remember that terms like “request,” “hope,” or “desire” are not usually considered by the courts as adequate for creating an enforceable trust. Complicated litigation can result from using precatory language in trusts, but it can be avoided by using clear instructions and definite language that leaves no doubt regarding your wishes. An attorney’s help in drafting a trust is usually the best way to avoid potentially detrimental complications. Sometimes precatory language can actually be useful as a way of further illustrating your intent without forcing the trustee into some undesirable results.
- Failure to Name Ascertainable Beneficiaries
You’re creating a trust in the interest of a specific beneficiary. If the property in question is to be managed according to your intentions, you must clearly identify the person or group of persons to whom the contents of the trust will be conveyed. If a trust is created without naming a beneficiary, then the court and trustee cannot effectively oversee the trust.
- Failure to Put the Trust in Writing
When a trust involves a grant of real estate or is created through the execution of a will, that trust must appear in writing in order to be considered legally valid. You might think that this requirement would seem obvious. However, a startling number of people fail to comply with this simple stipulation. Unfortunately, these people believe that verbal agreements with family or close friends will adequately validate their wishes. But without a written trust, there is no guarantee that your wishes will be granted. A written trust ensures that your property and assets are used as you desire and that your intended beneficiary receives the contents of the trust.
Don’t let these common mistakes intimidate you! With a little clarity and understanding, setting up a living trust is a fairly straightforward process. And of course, if you have any questions regarding your trust and the related legal implications, our team is always ready to help. Call our Port St. Lucie office at 772-878-7271 or send us a message online! We serve all treasure coast seniors and those who love them.