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Is a Living Trust right for me?

Attorney Paul Premack conferring with a couple about a Living Trust

Hi Paul - We live south of Seattle, and have our house in Washington, our former house (now a rental) in Texas, and inherited property in the states where our parents lived. How would a Living Trust help us?C.W.

Most often, a Living Trust is set up to help reach two goals. First, it provides a framework to manage your assets properly if you become disabled. You select a Trustee as legal owner and manager of the assets (often, you select yourself as Trustee so long as you remain healthy). You also specify one or more alternate Trustees in case you should become disabled.

Second, a Living Trust helps keep your estate out of probate court when you die. In the Trust, you name individuals and institutions to receive your estate, just as you would in a Will. When you die, the Trust distributes your remaining assets without probate if everything was set up correctly.

When you own land in multiple states, your estate may have to go to probate in all of those states. A Living Trust can be the solution, helping your survivors avoid multiple probates in the different states where you own land.

Here are some questions and answers on Living Trusts that may help you decide if a Trust is right for you and your family:

If we set up a Trust, how does it become legally involved in the real estate we own?

Currently, you own the real estate in your own individual name. Once the Trust exists, your legal counsel will draft deeds for you to sign. The deeds will transfer ownership from your name into the name of the Trustees of the Living Trust. Those deeds will be recorded in the counties where the real property is located. In the Trust agreement, you will specify the identity of the Trustees (usually you appoint yourselves as initial Trustees, then appoint successors to take over in case of your incapacity or death). The agreement also specifies what happens to the real estate after you die; for instance, it can be distributed to your children, or be sold, or be donated to charity. The Trust carries out your wishes just like a Will would do, but without going to probate court in each of the states where land is located.

Where should I obtain a Living Trust? I’ve seen ads, gotten fliers for seminars, and had salesmen contact me.

Beware a Trust salesman who hawks trusts and insurance products. First, that person may not be licensed to practice law or to dispense valid legal advice. If you give out any information, it is not protected by the attorney-client privilege. Second, that person will not discuss with much enthusiasm alternatives to a Trust that might serve you better as he has no legal expertise. Third, that person is very likely using the trust to get a foot in your door to market annuities or other insurance products to you. Always use an experienced estate planning attorney who will put your best interests at the forefront.

What is the cost of a Living Trust compared to a Will and probate?

Attorneys each set their own rates, so there is no way to predict exact costs. A Trust prepared by a licensed and experienced estate planning attorney is likely to be no more expensive than one from an unqualified and unlicensed salesman representing a distant company. Sometimes you should expect to pay an equivalent probate cost for your Living Trust to the licensed attorney. On the other hand, a Will is often less expensive up front than a Living Trust, because a Will does not contain a plan for managing your assets if you become disabled and would have to be probated in all the different states where you own property.

The costs of probate vary greatly, depending on many factors. In general, the cost of administering a Living Trust when one party dies is less than the cost of probate. This is especially true if the Trust is prepared for a married couple and is written to avoid probate when each spouse dies. In your situation, with land in multiple states, the Living Trust is going to save your heirs a lot of money.

Do I have to rearrange all my accounts and investments?

To gain the best advantage from having a Living Trust, you should fully fund the Trust. To do so after the Trust exists, you contact your financial institutions to re-register your accounts as held by the Trustees of your Trust. You re-title your home, other land, and cars to the Trustees. That way, if you become ill, your successor Trustee can take over immediately. When you die, all the assets funded into the Trust pass to those you specify in the trust agreement, without going through probate court.

Is an unfunded Living Trust a good choice?

Sometimes, Living Trusts are established and only a token amount is transferred into the trust (an "unfunded" trust). Since an unfunded trust is essentially empty, you must have a strategy to turn over your assets at some future date. Typically, you give the same person who is named Trustee a Durable Power of attorney to act as your Agent. Then, if you become disabled, the Trustee hurries to convey your assets into the trust before you die. The Trustee must act quickly since the power of attorney legally ends when you die.

The risk with an unfunded trust is that if you die unexpectedly (quickly), an unfunded trust provides no significant benefits. Your assets are still owned by you personally, not by the trust. As such, the assets go through probate. The unfunded trust did not help you to avoid probate, and your Will is used to distribute your estate. That is why unfunded Living Trusts are the less common variety.

Instead of using an unfunded trust, some people who have no family nor anyone close to act as successor Trustee can call on a bank trust department to take that role. You can name yourself as Trustee of your fully funded trust (with the bank named as successor Trustee) or, with an unfunded trust you can name the bank as initial Trustee. Either way, the bank’s authority is delayed until you become disabled. But with an unfunded trust, the bank has the additional burden and delay of gathering your assets and transferring them into the Trustee’s control.

Does a Living Trust provide estate tax savings over using a Will?

From a tax standpoint, a “Living Trust with tax planning” and a “Will with tax planning” are identical. They can each be structured to save exactly the same amount of federal estate tax, and both use the exact same technique. The real difference is procedure and privacy: a fully funded Living Trust does not go through probate, while a Will of this type must be probated. It is the estate tax plan that can reduce tax; the type of document in which the plan is contained is secondary.

Any proper estate plan can be written to include provisions to reduce estate tax or can be written to ignore the tax issue. It is legally appropriate to omit estate tax provisions when the exemption provided by law will automatically eliminate the tax. Specifically, anyone who dies in 2023 with an estate smaller than $12.92 million will not owe estate tax (and a married couple, with proper planning, can eliminate tax on up to $25.84 million). The exemption will increase to $13.61 million for 2024, go up again in 2025, and then the exemption is scheduled to go down to about $6 million for each person in 2026 (unless Congress votes to keep the higher exemption).

Can Premack help me with a Living Trust?

Yes! You can (step 1) schedule a consultation online at using the yellow “make an appointment” button. Then (step 2) organize your information using my free Estate Planning Organization Guide. We will then have a video or phone conference to examine the pros and cons of a Living Trust under your particular individual circumstances.


Paul Premack is a Certified Elder Law Attorney for Estate Planning, Trusts, and Probate. Paul is licensed to practice law in Texas and Washington. Visit our website at to read the archive of articles or to make an appointment or call us at 210-826-1122 (Texas) or 206-905-1122 (Washington).

Article published on November 6, 2023.


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