Different classes of people may desire a trust for different reasons entirely. The purpose of this blog is to quickly summarize why someone in your particular place in life may desire a trust.
Anyone who is single and has assets titled in their sole name should consider a revocable living trust. The two main reasons are to keep you and your assets out of a court-supervised guardianship and to allow your beneficiaries to avoid the costs and hassles of probate.
If you're married, and the estates of you and your spouse exceed the federal estate tax exemption, then you should consider establishing revocable living trusts to take advantage of both spouses' exemptions from estate taxes. Although portability will allow you to skirt around this limitation, portability is not effective for maximizing generation-skipping tax exemptions.
For married couples the main benefit of having a joint trust is that, throughout the entire process, there is no court involvement. This minimizes costs and promotes privacy. The couple no longer has to worry about whether a particular asset is owned by one of the spouses because all assets are simply owned by the joint trust. Since only one trust is ever created, no transfers need to be made after the death of the first spouse to die. This simplification in the administration process minimizes advisors' fees and other costs and is a key advantage of using a joint trust.
If you're in a second or later marriage and you and your spouse will have different beneficiaries such as your children or grandchildren, then you should consider establishing revocable living trusts to ensure that each spouse's estate will go where he or she wants it to go outside of the probate process.
If you own real estate in more than one state, then you'll need to establish a revocable living trust and deed the out of state property into the trust. Otherwise, your family may be faced with two separate probate estates — one in the state where you live, and a second in the state where your real estate is located, which is referred to as "ancillary probate."
If you need assistance establishing a revocable living trust, I welcome you to contact me online or call my Anchorage office at 907-306-9166. I offer estate planning services for individuals and families throughout Alaska.