Lillie N. Nkenchor, PC

Revocable Trust

Revocable Trust: A Trust is similar to a Will in that it is a legal document that provides a set of instructions with respect to who is to care for minor children, how assets (or money) and charitable gifts are to be distributed. However, it can go further by providing more specific instructions that last over a longer duration. Instruction examples: Anne’s trust provides that Lillie is a beneficiary and will receive $100,000, but not until Lillie reaches age thirty. Lillie is currently twenty-two, so she must wait eight years to receive her gift. Or, Lillie will receive $100,000 beginning today, but not all at once, instead, she will receive over five years. For those types of longer-duration instructions, a trust should be used. The trust also provides creditor protection at death (no creditor protection while alive) so that assets left for beneficiaries are safe from creditors and divorce. The Will handles the simple, quick distributions, while the Revocable Trust handles the more complex distributions. Also, the Trust skips the probate process; meaning it is not administered with the Surrogate’s Court (it may be called something else in your jurisdiction) and approved by the court before the Trustee can take action.

Who are the players?
Grantor: The person who creates the Trust, chooses the Trustee and beneficiary(ies)
Trustee: Follows the instructions provided in the Trust. This can be any person, over the age of 18. If you are married, it does not have to be your spouse.
Beneficiary: The person or entity that receives assets or money after debts and liabilities are paid.

Common Myth: If one has a Trust, then a Will is not needed. A Will acts as a safety net, it catches those assets that may have slipped through the cracks and do not know where to go; for example, accounts that do not have beneficiaries named. Thus, it is good to have a Will. Also, since all estates undergo the probate process (there is an expedited probate process for estates that are small; your state defines “small”) it is better to have a Will so as to ease that process, otherwise, your state will assign a Will which can be a slower and more costly process. When you do not have a Will and are assigned one by your estate, it is called passing Intestate.

Picture of Lillie N. Nkenchor
Lillie N. Nkenchor

Lillie N. Nkenchor, Esq., LL.M, President of Lillie N. Nkenchor, PC, educates individuals, families and business owners on estate and business planning concepts. As an attorney and engaging speaker, she helps clients address their vision and devise appropriate, tax-efficient strategies that meet personal and business goals. She is uniquely skilled in removing complexity so her clients can take control of their personal and business objectives.