No.

Even if you have a living trust, you still need at least a will, called a pour-over will. That instructs your executor to transfer to the trust any assets you did not transfer before death so they can be governed by the trust's provisions. You also have to use a will to name guardians for minor children.

You should also have a durable power of attorney for financial matters (durable means it continues after you become incapacitated) and a health care proxy. If you do not have someone you trust enough to make these decisions for you, consider that a trust allows you to name an institution, such as a bank, as trustee -- but you can not name an institution as agent under a durable power of attorney.

A basic plan often includes a living will. A living will spells out your wishes about life-sustaining medical care -- such as whether you want to be kept alive on a respirator -- and it goes into effect only if you are terminally ill and unable to speak for yourself.

Yes.

Only assets you own in your own name at death are probate assets. Thus, your probate estate may be smaller than you think, making avoiding probate less of a necessity. Assets not subject to probate include property you own jointly with the right of survivorship, the proceeds of life insurance policies on your own life that have named beneficiaries and balances in IRAs and 401(K) plans that have named beneficiaries, as well as the assets owned by a revocable living trust. And remember that probate has some benefits, such as shutting down the rights of creditors who do make their claims within the allotted amount of time.

Yes. One of the most valuable benefits is that the trust sets up a blueprint for handling your affairs if you become incapacitated. Your successor trustee (or co-trustee, if you named one) can take over for you.

Trusts allow great flexibility in carrying out your wishes. For instance, you can specify in the trust exactly how you would like your money to be spent, right down to what kind of nursing facility you would want to be in.

In addition, actions by trustees may be accepted more readily by some financial institutions than actions by agents under durable powers of attorney (durable means it continues after you become incapacitated). Please note that some financial institutions honor only their own durable powers of attorney forms, so always check their requirements.

Revocable living trusts generally are private documents, whereas wills become public record when filed in the courthouse. However, in some cases, the trust may have to be filed as well, such as when you transfer real estate to the trust, or if there is litigation over your estate. In these cases the trust now becomes public.

If you own real estate, such as a vacation home, in another state, transferring it to a revocable living trust avoids having to probate it in that state.

A trust is more work to create than a will because to make it work you have to actually transfer assets to the trust which can be tedious and time-consuming, and may mean changing titles on real estate. Further, when you deal with trust assets, you have to act as trustee, signing checks and other transactions in your capacity as trustee.

A notorious problem lawyers see time and again is that people fail to transfer assets to the trust when it is created or forget to transfer assets acquired after the trust has been set up. If assets are not in the trust when you die, it is basically useless. Any assets left out have to go through probate, defeating the one reason you may want the trust in the first place (and emphasizing why you need a pour-over will).

You and your spouse are typically the primary beneficiaries of the trust with, perhaps, your children and grandchildren as beneficiaries after your deaths.

Typically, you serve as your own trustee (or co-trustee with, say, your spouse or child or a financial institution), meaning you retain control of your assets as long as you are able to manage your own affairs. If you become unable to manage your own affairs, another trustee, known as the successor trustee, takes over.

When you die, the trust becomes irrevocable, and the trustee distributes the assets as the trust document specifies or keeps them in trust for the beneficiaries, if that is what you have arranged.

Also known as a Living Will, a health care directive is one of the most important estate planning tools. It allows an individual to name someone who will make health care decisions. The health care directive is only effective when a person cannot communicate his or her wishes to the health care provider. Health care directives guide the health care agent in making important and sometimes difficult decisions regarding medical care.

Naming an “Agent” or “Attorney in fact” can be a significant estate planning tool. Once the power of attorney is signed, the attorney in fact can handle financial matters for another individual (the principal). In many cases, the authority of an Attorney in Fact is limited either to specific transactions or situations where the principal is unable to act.

With my extensive background and education in the areas of law, tax, and accounting, I provide a thorough analysis of your estate planning needs. If reducing estate tax liability is a priority, my personalized, competent and trusted advice will help you achieve your estate planning goals.

No. This is one of the biggest misconceptions about revocable living trusts. The income of the trust is considered yours. If you are the creator of the trust as well as the trustee or co-trustee, you report the income on your personal income tax return.

If the trust is in effect when you die, the assets are included in your estate for federal estate tax purposes. However, if your estate is large enough to be hit by the federal estate tax, your lawyer can incorporate tax-saving measures into your trust, such as charitable gifts, a marital deduction trust and a credit-shelter trust.

Also, a living trust does not protect assets from creditors while you are alive and in control. And the trust does not protect assets if you are sued.