Everyone needs a living trust.
Living trusts are excellent estate planning tools because they offer some specific benefits that many other tools do not. For example, a living trust will allow you to transfer property after your death much more privately than if you had to go through the probate process. However, living trusts are not a suitable tool for everyone, and while they do convey specific benefits, not everyone may be interested in, or need, the benefits they provide.
If I create a living trust I can avoid estate taxes.
This is one the most common myths about living trusts and it is completely false. A revocable living trust does not give you any protections against the federal estate, gift, or generation-skipping transfer taxes. While there are some trusts and other estate planning tools that can aid you in estate tax mitigation and asset protection, a revocable living trust is not one of them.
My living trust will allow my heirs to inherit property immediately after I die.
Many people know that creating a living trust will help eliminate, or significantly reduce, the need for your estate to go through probate. While this is true, it doesn’t mean your heirs will be able to inherit everything automatically. There are still procedures and processes that the trustee will need to go through before your beneficiaries can receive the property you have placed in the living trust. While trustees can typically transfer property from a living trust to the beneficiaries more quickly than a probate administrator can, it is not an instantaneous transfer.