Is A Living Trust Appropriate For Your Estate Planning Needs?

"Misleading and/or factually false statements are often made about the benefits of living trusts." Or so many critics of living trusts maintain.

Critics don’t deny that living trusts have value for some people. But they do question their value for most people. Critics believe that living trusts have become over-sold and over-promoted.

How can you, a potential customer, determine if a living trust is appropriate for your situation? Certainly, you want to ask questions to the person recommending that you consider a living trust. But this person may have a conflict of interest. Is there anything else you can do?

One possibility is through self-education. Books and other publications are available to help you. But most people don’t have the time or inclination to do the reading.

Living Trust Living Hell: Why You Should Avoid Living Trusts is a book that might be worth your time if you are interested in self-education. It is written by John P. Huggard, J.D., CFP and published by the Kendall/Hunt Publishing Company. It costs $49.95.

As the name implies, this book is not partial to living trusts. If you choose to read this book, keep its bias in mind.

But even if you don’t read it, you can still benefit from one of its features. The book includes two disclosure forms for you to review with whomever is suggesting that you use a living trust. The Kendall/Hunt Publishing Company has given The Arc of Indiana permission to reprint these disclosure forms. Links to the disclosure forms are provided at the end of this memo.  Feel free to use them.

Each form lists nine statements. According to Professor Huggard, each statement is misleading or factually false. If you believe any of the statements are true and you are going to use the living trust because you believe the statements are true, then your expectations will not be met. Either you have misunderstood what you were told about living trusts or you have been misinformed.

Professor Huggard developed these forms as a way for people like you to gain confirmation that your understanding of the utility of living trusts is accurate. Review these forms with the people who are suggesting that you consider a living trust. Do these people agree that these statements are false, or do they maintain that some of these statements are true? Perhaps the most important question is, will they sign both disclosure forms, thus giving you added peace of mind?

Living Trust Disclosure Form A

Living Trust Disclosure Form B

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