What are the Benefits of a Revocable Living Trusts
Let's Look at Some of the Benefits of Revocable Living Trusts
and How Trust Can be Useful for People of Ordinary Means
PAUL A. KRAFT
Indiana Estate Planning Attorney
WHAT ARE THE
BENEFITS OF A
REVOCABLE LIVING TRUST?
What Are the Benefits of a Revocable Living Trust? www.FrankKraft.com 2
There are people who assume that trusts are only for very wealthy families. This
is really not the case. There are different types of trusts that serve different
A revocable living trust is a type of trust that can be useful for people of
ordinary means. Let's look at some of the benefits of revocable living trusts.
When you hold on to your personal property until the time of your death and
arrange for its transfer through the terms of a last will, the estate must be
probated before the heirs receive their inheritances.
During probate the court determines the validity of the last will. If anyone
wanted to challenge the will, arguments could be presented before this court.
When you create a last will,
you nominate an executor or
personal representative. The
executor handles the estate
administration tasks. The
probate court supervises the
administration of the estate.
There are a number of
drawbacks that inherently come
along with the probate process.
For one, probate is a public
proceeding. The records are available to the general public. Anyone who is
interested could find out what went on during probate. This loss of privacy is
disconcerting to many people.
In addition to the loss of privacy, there are significant expenses that can
accumulate during the probate process. The executor is entitled to payment for
his or her time and effort. Final debts must be paid, including taxes, so there
may be accounting fees.
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Because probate is a legal process, the executor will often bring in a probate
lawyer, so there are legal expenses. Property must be inventoried and
liquidated, so there could be
appraisal and liquidation costs.
There may be various
incidental ad hoc expenses as
well. All in all, a noticeable
portion of the estate can be
consumed during the probate
The third drawback that we
would like to highlight is the
matter of time consumption.
You probably would like your heirs to receive their inheritances in a timely
fashion. This will not happen when probate is a factor.
At minimum the probate process will take several months. There are some cases
that take years. The heirs to the estate do not receive their inheritances while
the estate is being probated.
This time lag can present a significant problem for some people who may have
been depending on the decedent
for financial support.
If you use a revocable living trust
to arrange for the transfer of
your monetary assets rather than
a last will, the probate process
will not come into play.
When you create the trust you
name a trustee. This can be a
person that you know, but it
could also be a professional fiduciary entity like the trust department of a bank
or a trust company.
You as the grantor of the trust create the trust agreement. The trustee will
follow the terms of this agreement and distribute monetary resources to the
What Are the Benefits of a Revocable Living Trust? www.FrankKraft.com 4
beneficiary or beneficiaries after you pass away in accordance with your wishes.
These distributions will not be subject to the process of probate.
Another benefit that you derive from the creation of a revocable living trust is
the ability to account for the possibility of incapacity. When you create the trust
you can name a successor or disability trustee. This individual or entity would be
empowered to administer the trust in the event of your incapacitation.
Incapacity planning is quite important if you want to be prepared for all the
eventualities of aging. There are various different causes of incapacity, but
Alzheimer's disease alone is enough to make incapacity planning a must for
serious minded individuals.
Alzheimer's strikes with alarming frequency. Over 40 percent of people who are
at least 85 suffer from the disease. If you create a revocable living trust, you
can be certain that a financial decision-maker of your own choosing is at the
ready to manage your resources if you become incapacitated at some point in
What Are the Benefits of a Revocable Living Trust? www.FrankKraft.com 5
A revocable living trust is a powerful estate planning tool. With this type of trust
you can facilitate the transfer of your financial assets to your heirs outside of
the process of probate.
Probate is a legal process that can be expensive and time-consuming, and there
is no privacy when an estate goes through probate.
When you create a revocable living trust, you can also account for the possibility
of incapacity by naming a disability trustee.
If you have detailed questions about the benefits of revocable living trusts,
contact a licensed estate planning attorney to arrange for a consultation. Your
attorney will answer your questions, evaluate your unique personal situation,
and make recommendations.
What Are the Benefits of a Revocable Living Trust? www.FrankKraft.com 6
About the Author
Paul A. Kraft
Paul Kraft is Co-Founder and the senior Principal of Frank & Kraft, one of the leading law
firms in Indiana in the area of estate planning as well as business and tax planning.
Mr. Kraft assists clients primarily in the areas of estate
planning and administration, Medicaid planning, federal and
state taxation, real estate and corporate law, bringing the
added perspective of an accounting background to his work.
In addition to his practice, Mr. Kraft has lectured extensively
in the areas of living trust planning, Medicaid planning, and
presenting public and private seminars on the importance of
proper estate planning. He has also authored various articles
on estate planning and is a contributing author of LEGACY:
Plan, Protect, and Preserve Your Estate–Practical Answers
from America’s Foremost Estate Planning Attorneys.
Mr. Kraft is a co-founder of the Indiana Network of Estate
Planning Professionals, a charter member of the AmericanAcademy of Estate Planning
Attorneys and a founding member of the National Network of Estate Planning Attorneys. He is
also a member of the Indianapolis Bar Association, including the Taxation, Business Law and
Estate Planning sections; the Indiana State Bar Association, including the section on Taxation
Law; the Indiana CPA Society; and the Estate Planning Council of Indianapolis. Mr. Kraft is
admitted to practice law before the Supreme Court of Indiana, U.S. District Courts, and U.S.
Frank & Kraft
A Professional Corporation
Attorneys at Law
135 N. Pennsylvania Street Suite 1100
Phone: (317) 684-1100
Fax: (317) 684-6111