A Revocable Living Trust, also known as a Living Trust, is used primarily to avoid probate, preserve your privacy, and manage your financial affairs. A Revocable Living Trust is a trust established while you are living and enables you to make changes whenever you want, as well as reclaim the property transferred into it. It describes how your property should be managed while you are alive and how it should be distributed upon your death.

Placing Assets in a Revocable Living Trust Avoids Probate

The principal benefit of created a living trust, is that upon your death, your beneficiaries can avoid the formal probate process. With a living trust, they do not need to go to probate court to ascertain your assets. This saves them tremendous time, expense and stress. The probate process is incredibly time consuming and it could take over a year until your beneficiaries receive a dime.

Furthermore, without a living trust, California law authorizes a certain value of your estate to go towards probate fees (e.g., attorney’s fees and executor’s fees). When valuing your estate, the court determines fees based upon the gross value of your estate and does not consider your debts to offset the valuation. Under Probate Code 10810, statutory probate fees are as follows:

• 4% of the first $100,000 of the estate
• 3% of the next $100,000
• 2% of the next $800,000
• 1% of the next $9,000,000

*Note that the above calculations may have to be done twice. Once to include attorney’s statutory fee and once to calculate the executor’s fee.

Let’s say for example the gross value of your estate is valued at $1 million. Your beneficiaries’ probate fees and court costs would be approximately $46,000 ($23,000 x 2).

By creating a living trust with our firm, your beneficiaries will avoid the stress and expense associated with probate. Our trust and estates attorneys will be able to guide you in creating an estate plan that reflects your intentions, protects your legacy, and provides you peace of mind. We invite you to review the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation to learn more.