Five situations where a revocable living trust is the correct estate planning tool
Five situations where a revocable living trust is the correct estate planning tool
Attorney Tom Olsen: Chrissy, I know there are people out there who are now wondering, "Hey, Tom and Chrissy, when do we use a living trust?" Well, let's give them some examples, okay? Number one, if you're a young couple and you've got young kids, hey, absolutely we're using a living trust for you because we can't pass your wealth onto kids that are seven, eight, nine years old. We're going to be using a living trust for you that if mom and dad both passed away their wealth, their life insurance, IRAs are going to go into a living trust. That money's going to be managed on behalf of their minor children, help them go to college, help them buy a car, help them buy a house, and then typically they don't get any until age 25.
Attorney Chris Merrill: Exactly.
Attorney Tom Olsen: That would be a reason.
Attorney Chris Merrill: It would be.
Attorney Tom Olsen: If you are an older couple out there and you want to leave money to your young grandchildren who are under the age of 25, your grandchildren, that would be a reason to use a living trust.
Attorney Chris Merrill: It would be.
Attorney Tom Olsen: If you have spendthrift children that you're concerned, "I've got a 35-year-old son, and if I left him a chunk of money he'd blow right through it." Well, then we need to do a trust for you so that that 35-year-old son his money is doled out to him over a number of years, potentially, for the rest of his life.
Attorney Chris Merrill: Exactly. You're right. Tom, in that situation too, any time and there's multiple reasons including spendthrift, including adult children on governmental benefits, and other reasons. If you don't want them to receive the money outright when you pass away for whatever reason including what you stated, then you must have a living trust.
Attorney Tom Olsen: Yes. I think that'd be the fourth category. It would be if you have a child or grandchild who's on governmental benefits, disability, Medicaid, et cetera, well, then we're not going to leave that child your money outright because they would disqualify them for governmental benefits. However, we have what's called a special needs trust where you can put money in trust for that child that's on governmental benefits and they get the benefit of your money and they continue to get their governmental check every month.
Attorney Chris Merrill: Exactly. Then one more major one, and that is real estate. Real estate where you have out-of-state property or you have many properties such as 10 properties, that would be a reason where it would be needed to do a living trust instead of just one ladybird deed.
Attorney Tom Olsen: Thank you, remind me. If you have real estate in other states other than Florida, good chance we're going to be using a living trust for you. Folks, if you're having a hard time figuring out, "Hey, Tom, are we using simple tools, are we using a living trust?" Well, Chrissy and I, we do a free initial consult. We will help you figure that out very quickly.
Folks, my name is Tom Olsen and the name of the show is Olsen on law. We're going to take a break. We'll be back in just a few minutes.