What happens to a living trust after death?

After you die, your living trust will be taken over by your successor trustee, who will manage the trust according to the terms you have laid out.

What will the successor trustee do with my living trust?

The successor trustee will manage the trust according to the terms laid out in the declaration of trust. Those terms will state what happens to the assets in the trust. Put differently, the terms say who gets your stuff, how they get it, and when they get it. Often, the successor trustee will also be named as personal representative in your will, which gives the trustee complete control over both the estate and trust assets. Additionally, a living trust is typically paired with a pour-over will, which moves the estate assets into the trust after your death. This means that the successor trustee will likely be in charge of large amount of your assets after death. But the trustee will be bound by the rules put in place by the trust itself.

This is why it is so important to have well-drafted estate planning documents. After you pass away, those documents govern what happens to your assets. You need those documents to be clearly and thoroughly written. Otherwise, you risk problems arising that could have been avoided with better lawyering.

What happens to my joint living trust after I die?

If you have a joint living trust, then the other grantor of your trust (usually your spouse) will take over the trust after you die.

In a joint living trust, two people are grantors. And both of those grantors act as trustees. Most joint living trusts provide that after the death of the first grantor, the second becomes the sole trustee of the living trust. Some trusts provide that after the death of the first grantor, the trust assets are split up into sub-trusts. This can be useful for tax planning. But other joint trusts do not split up any assets at the death of the first grantor and instead let the second grantor control everything. It all depends on what the terms of the trust are.

Do I need a living trust?

Whether you need a living trust depends on a number of personal variables. If you have enough assets or if you own property in multiple states, then you likely do need a living trust. Or if you highly value privacy and want to avoid your assets entering the public record, then you likely need a living trust. However, some people are able to get by with a will. If you want to know what makes the most sense for you, schedule an appointment with an estate planner.