Contrary to popular belief estate planning is not one-size fits all and not everyone needs a revocable living trust. However, they are a good option for many people.
When you start asking around for estate planning advice, you will probably find the first thing many non-experts say about it is that you need to get a revocable living trust. They are extremely popular instruments and articles abound on the Internet extolling their virtues. They are so popular that a common belief is that everyone should get one.
That noted, they do have drawbacks and these drawbacks might make some people decide to go another route.
Recently, the Motley Fool looked at the benefits and drawbacks of revocable living trusts in "Is a Revocable Living Trust Right for You?"
The biggest benefit of a revocable living trust is that your primary assets, as long as they are transferred into the trust, do not have to go through probate when you pass away. As probate can be an expensive and time-consuming experience, this can make handling your estate much easier for your heirs. Probate is also normally a public process, but if you have a trust you can keep your estate details private. Finally, should you become incapacitated a successor trustee can take over your finances instead of having to go through court to get a guardian.
On the other hand, trusts can be more expensive to set up than other estate planning instruments, but they might save your estate money in the long run depending on probate costs. Transferring assets into your trust can also be very time-consuming depending on what you own. Having a revocable living trust also does not mean you do not need a will. You will still need a simple will to deal with anything left out of the trust.