A living trust is the only way to guarantee that your assets are distributed as you wish and still avoid probate, which is the legal process of proving that your will is valid. Trusts are generally cheaper, which is why we like them. Legal fees for the probate process could be 3% of your estate, but that number could fall down to 1% for distributing trust assets.

We should point out here that many states have simplified the probate process to the point where a living trust may be unnecessary. In some instances, your executor can validate your wishes for your estate simply by mailing a certified copy of your death certificate to the county probate court. Be sure to check with an estate planning attorney or your county probate court to determine the laws in your state.

There are two types of living trusts: revocable (which means you can change it while you're alive) and nonrevocable (which means you can't change it). For many individuals, we like revocable living trusts because they offer flexibility (taking care of you while you're alive), privacy and speedy asset distribution. But they're not for everyone.

A revocable living trust may be more beneficial to you than a will alone. Here are the facts:

• FACT 1: A revocable living trust lets you avoid the costly probate process. This is very important if you crave privacy and want to speed assets to your heirs. However, if the bulk of your estate consists of assets held jointly with the right of survivorship, insurance proceeds that are left to a named beneficiary, and/or retirement proceeds left to a named beneficiary, a living trust may be unnecessary since all of these assets generally automatically bypass probate.
• FACT 2: A living trust keeps the court out of your affairs while you are alive. You can name yourself as a trustee, and your successor trustee (a family member or trusted professional) can care for you with your own assets if you become incapacitated or incompetent. Without a living trust, the court would have to be petitioned to allow your assets to be used for your care.
• FACT 3: A revocable living trust lets you change investments, terms or beneficiaries anytime during your lifetime and use the trust income for your needs. You then leave the trust assets to whomever you want.
• FACT 4: Your trust instructions are generally written in greater detail than instructions in your will, so it's much harder for a disgruntled relative to contest your trust than your will. During the probate process with a will, on the other hand, a malcontent can slow down the asset distribution process to a slow walk...or a crawl.

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