I have attended (snuck into?) some of the Living Trust seminars conducted by my colleagues. I have heard them take more than an hour to describe what the Living Trust is and how it works. Maybe you have been to one and wondered why you are sitting in a hot room for over an hour, listening to someone talk and talk about the purpose of a Living Trust. In this chapter, I will tell you—in three to five minutes—what a Living Trust is and what it does.
As you listen to my advice, I would ask that you forget everything you have ever heard about the basic mechanics of the Living Trust, even if you have one. If you focus on my explanation of the Living Trust—that it is simply an after-death power of attorney— you will guide yourself out of the legal haze thrust upon you by the Living Trust’s multiple pages filled with legal words that we lawyers have to use so the document can qualify as a legally correct trust.
The Living Trust is not a true trust arrangement. Oh, yes—it looks like a trust, reads like a trust, smells like a trust, and tastes like a trust. It has all the complex words and phrases that a trust is supposed to have. But still, it is not a true trust arrangement.
A true trust arrangement takes place when you take your money and property to a money manager and say, “I want you to manage these assets. I want you to take care ...