Cristyn: Hi. Today we’re going to talk about what a trust actually is. A trust does allow you to say who you want in charge when you pass away of distributing your assets and where you want your assets to go. Think of a trust as a living entity, so it’s very similar to an LLC. LLCs can own property and the person who owns the LLC is in control of the LLC itself and anything owned by it. Same concept with a trust.
If you will, this here is your trust, for revocable living trust. Almost always what we’re doing is we’re taking the person’s primary residence, so where they live, transferring it inside the trust. What this does is it’s weird because it changes the ownership relationship. Now, the people who own the home actually don’t own the home anymore. Their trust owns the home, but they are in complete control of the trust.
If they want to take it back out, they absolutely can. This ownership relationship allows the person’s assets to completely avoid the court process known as probate when they pass away. It’s a great tool across the board, regardless of the person’s circumstance for avoiding probate, inside trust we can do all sorts of things like putting rules in place for distribution. One of the great things about it is, let’s say we set up your trust in Missouri because you live in Missouri, but over time you start acquiring properties in other states, and you want to put them inside your trust as opposed to other things you could potentially do like LLCs.
Your Missouri-based trust can actually own property anywhere in the United States. When you start buying property out to the country we get into a different territory. It’s different rules in each country. For the United States, your Missouri-based trust can own property anywhere, and your Missouri-based trust is now going to control and follow whatever rule pattern you’ve set.
Your trust can also inherit all of your different assets, and then it can say, “Here’s what happens when I pass away. Here’s who’s going to inherit,” and should we find ourselves in what we call the zombie apocalypse, what happens when a person passes away and now we have to figure out what happens to their share? Your trust controls. We looked the trust. The trust says, “Ah, if Jane passes away, her children get it.” Now we know her children are sharing it. Any rules that we’re applying will apply to them, and we get to avoid court. Everybody’s happy. Very seamless, very easy vehicle to distribute your assets however you want, while allowing you to maintain complete control while you are alive.