Yes, absolutely you can create a trust jointly with your spouse, and in many cases, it’s a highly recommended estate planning strategy for married couples.
What are the Benefits of a Joint Revocable Trust?
A joint revocable living trust, sometimes called a marital trust, allows couples to manage their assets together during their lifetimes and ensures a smooth transfer of those assets after one or both of you pass away. Approximately 60% of Americans don’t have a will, let alone a trust, leaving their assets subject to probate – a potentially lengthy and expensive court process. A trust avoids probate, saving time, money, and maintaining privacy. It also allows for continued management of assets if one spouse becomes incapacitated, avoiding the need for a court-appointed conservatorship. Furthermore, it can streamline the process of inheriting assets for your beneficiaries. The trust document outlines exactly how assets should be distributed, minimizing potential family disputes. It’s an incredibly versatile tool tailored to your specific needs and goals.
How Does a Joint Trust Differ from a Will?
While a will dictates how your assets are distributed *after* your death, a trust allows for management of those assets both during your life and after. A will must go through probate, which can take months or even years, and costs an average of 5-7% of the estate’s value in many states. A trust, however, allows assets to pass directly to your beneficiaries without court intervention. I remember Mrs. Gable, a lovely woman who came to me after her husband passed without a trust. Because of the lack of planning, her family faced a frustrating six-month probate process, along with significant legal fees, when all she wanted to do was grieve. It’s a common story, and a preventable one. A trust provides continuous asset management and distribution, offering peace of mind and a faster, more efficient transfer of wealth.
What Assets Can Be Included in a Joint Trust?
Almost any asset can be titled in the name of your trust, including real estate, bank accounts, investment accounts, and personal property. It’s important to properly ‘fund’ the trust by transferring ownership of these assets to the trust itself. This is a crucial step often overlooked. I once assisted a couple who created a trust but never transferred their home into it. When the husband passed away, the house still had to go through probate, defeating the entire purpose of the trust! Proper funding ensures that all assets are governed by the trust’s terms. As of 2023, roughly 48% of Americans own stocks, making investment accounts a common asset to be included. By carefully titling assets, you maintain control during your life and guarantee a seamless transition to your beneficiaries.
What Happens if One Spouse Becomes Incapacitated?
One of the biggest benefits of a joint trust is that it provides a built-in mechanism for managing assets if one spouse becomes incapacitated due to illness or injury. The trust document will name a successor trustee – someone you trust – to step in and manage the assets for the benefit of the incapacitated spouse. Without a trust, a court would have to appoint a conservator, which can be a lengthy, expensive, and public process. I recall Mr. Henderson, a successful architect, who suffered a stroke and was unable to manage his finances. Fortunately, he and his wife had established a trust years prior. His wife, as the successor trustee, was able to immediately step in and manage their assets, ensuring his care and financial security. This avoided the need for a conservatorship and a significant amount of stress for the family. Planning for incapacity is just as important as planning for death.
Establishing a joint trust with your spouse is a powerful way to protect your assets, ensure your wishes are honored, and provide peace of mind for both of you. It’s a complex legal document, so it’s crucial to work with an experienced estate planning attorney to create a trust that meets your specific needs and goals. Don’t wait until it’s too late—start planning today!
Who Is Ted Cook at Point Loma Estate Planning Law, APC.:
Point Loma Estate Planning Law, APC.2305 Historic Decatur Rd Suite 100, San Diego CA. 92106
(619) 550-7437
Map To Point Loma Estate Planning Law, APC, a living trust lawyer: https://maps.app.goo.gl/JiHkjNg9VFGA44tf9
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