A Living Trust Lets You Use Your Assets When You Need Them

You can put whatever assets you choose in a living trust, although there are restrictions on certain items like 401(k)s and IRAs. Your living trust can include real estate, bank accounts, stocks and bonds, personal property, and more. One of the main benefits of a living trust is that you can control – and use – your assets while you’re still alive.

If you were to become mentally incapacitated at some stage, your trustee could take over management of your assets, without the need for any court proceedings.

Revocable Living Trusts vs Irrevocable Living Trusts In Colorado

There are two main types of living trusts: revocable living trusts and irrevocable living trusts.

You can change or dissolve a revocable living trust anytime you want during your lifetime. An irrevocable living trust, on the other hand, is incredibly hard to change and becomes permanent as soon as its executed. Which one is better for you? We can talk about your specific desires and needs, look at the big picture of your estate planning, and make a recommendation.

Avoid Probate And Keep Your Wishes Private With A Living Trust

A living trust allows you to avoid probate in Colorado, which can save time and money. You also maintain privacy when you set up a living trust to distribute your assets after your death. If you decide to create a will, (instead of a trust), after your death, your will becomes public record, according to Colorado law. If you die without a will, your estate will still go through probate and become public record. A living trust, however, is completely private. No one, except your trustee, needs to ever know how you chose to distribute your assets.

Dictate When Your Assets Are Distributed To Your Beneficiaries With A Living Trust

With a will in Colorado, your assets are turned over to your beneficiaries as soon as probate ends. But with a living trust, you can set timelines (and/or conditions) for when your beneficiaries receive your assets. This living trust feature can be particularly helpful if you want to leave assets to minors, but would prefer to wait until they reach a certain age or achieve certain milestones.

Living Trusts And Medicaid

It’s important to note that you can’t use a living trust to “hide” assets from Medicaid. When looking at eligibility, Medicaid factors in the assets in a living trust, so revocable living trusts don’t help with Medicaid planning. And if you’ve put assets in an irrevocable trust in the “look-back” period for Medicaid (which is five years), that could affect your Medicaid eligibility.

How To Set Up A Living Trust In Colorado

To set up a living trust in Colorado (revocable or irrevocable), in order to ensure that everything is done correctly, you should use an experienced estate planning and trust attorney. We can help you with all aspects of the living trust process, including planning, executing, and transferring ownership of all of your assets into the trust’s name.

For more information about living trusts, or to schedule your free estate planning consultation, please call 720-547-2319 or email jeff@althauslaw.com.