A “living trust” is a revocable trust that is created for the purpose of managing the property affairs of the trustor(s). In its pure form it will contain all the assets of the trustor(s) and the trustee(s) during the life of the trustor(s) will be the trustor(s). In this context it takes the place of a power-of- attorney. It is a far more flexible and effective way of managing property then reliance on powers of attorney, forms of asset ownership with surviving spouses and children, and oral promises of surviving spouses and children. It is particularly useful with respect to the affairs of retired persons.
The typical advantages of a living trust are as follows:
1. Flexibility in replacing trustee(s) when the trustor(s) are unable to function.
2. Imposition of fiduciary duties upon the trustee(s) to fully and faithfully perform their duties as provided in the trust instrument and according to state law.
3. Commercial acceptance by insurance companies, government, security firms and other financial service organizations.
4. Clear instructions on the management and control of all or select assets.
5. Prompt disposition of assets on death outside of the judicial system.
6. Privacy of estate composition and management.
7. Resolution of issues relating to property ownership, control and valuation prior to the trustor(s) death.
