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A living trust provides privacy unlike the probate process

New Jersey residents may have negative feelings about the probate process. Although it is a completely legal and legitimate way for an individual's property and final arrangements to be handled at the time of death, some people have problems with the very open and public nature probate may utilize in achieving those ends. As a result, they may look for alternative means of estate planning to preserve some privacy for their end of life affairs.

One tool that may aid such people is a living trust. A living trust is created by a grantor and managed by a trustee for the benefit of a third party, often called the beneficiary. The property continues to be owned by the grantor, although it is controlled per instructions by the trustee. The beneficiary receives payments or other benefits based on the management rules of the trust instructions and when the grantor passes away the trustee gives the beneficiary all of the property that was contained in the relevant trust.

A living trust ends with the death of the grantor and the trust instructions stipulate that the trust property is to be transferred to the beneficiary, so there are no property-related matters left over for the probate process to address and therefore no reason for the terms of the trust to become public. As probate generally deals with property over which there are no testamentary instructions, a living trust is a way to have property managed during a person's lifetime and then efficiently transferred to a beneficiary at the time of the trust creator's death.

Living trusts are just one tool that individuals may use when making estate planning considerations. They may help individuals avoid probate, but there are many other factors that should be weighed before they are created.

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