Revocable Trusts provide a host of benefits to the beneficiaries of a deceased loved one. Probate is avoided and administration is less cumbersome. These are nice benefits of a revocable trust; however, some clients feel that these benefits do not outweigh the cost of setting up an estate plan with a revocable trust.
A circumstance that make a revocable trust really needed is when the individuals have been previously married.
In a first marriage situation, a couple will ordinarily provide first for one another. It is only when the survivor passes that subsequent distributions are made to beneficiaries. In a subsequent marriage, the parties may want to make some provision for one another, however, they want to control the ultimate distribution of their portion of the estate so that it flows to their children or siblings.
If the couple only has Wills, there is no ability to put strings or conditions on money left to the spouse. Whatever he or she receives through the probate process will be absolutely available to the survivor to do with as he or she pleases. In other words, if the estate is left to the survivor, there is no guarantee that he or she will leave any of the remaining estate to the children or family of the first to die.
A revocable trust enables the grantor to put strings on money given to the spouse. The money remains in trust and is available for the use of the survivor; however, the money left at his or her death will flow to the children of the first to die.