Some United Kingdom residents who are planning on how their assets will be distributed when they die may want to consider the use of a revocable living trust. This type of vehicle may make it possible for assets to pass to beneficiaries while avoiding probate. It does not lower the estate tax burden, but probate can be expensive and time-consuming, so a revocable living trust might be a solution. However, before proceeding, those who are interested should find out whether avoiding probate is necessary based on the size and nature of their estate.
One advantage of a revocable living trust is that it allows an individual to retain control over the property. The grantor can revoke the trust or change its terms at any time. A revocable living trust can also protect assets if the individual becomes incapacitated.
The trustee that is named can be the grantor or can be someone else. In many cases, a co-trustee or successor trustee is named, who would then manage the trust after the grantor becomes incapacitated or dies. This may include distributing assets to the trust beneficiaries.
An attorney may be helpful in drafting estate planning documents. A number of factors may go into deciding whether a revocable or irrevocable trust is the best choice for protecting and distributing assets, and an attorney may be able to advise regarding the best option. Furthermore, estate planning may encompass many other considerations and documents. Individuals may wish to create a living will that deals with end-of-life care and appointing a health care proxy to make medical decisions. Parents might want to consider appointing guardians for their children. Individuals also should make certain that their retirement accounts, insurance and other policies and accounts name the correct beneficiary. All of these documents should be the subject of periodic reviews in order to keep up with changes in circumstances.
Source: American Bar Association, “What is a Revocable Living Trust?”, accessed on Jan. 27, 2015
