Living Trusts - How to Avoid the Scams Misinformation and misunderstanding about living trusts provide the perfect cover for scam artists who have created an industry out of older people's fears that their estates could be eaten up by expensive probates and taxes. Some unscrupulous businesses are advertising seminars on living trusts or sending postcards inviting consumers to call for in-home appointments to learn whether a living trust is right for them. In these cases, it's not uncommon for the salesperson to exaggerate the benefits or the appropriateness of the living trust. To prevent deception, fraud and unfair practices, the Better Business Bureau, along with the Federal Trade Commission advises consumers to learn the terms that are used in this aspect of financial planning before beginning conversations about it.
Probates can be costly and time-consuming.
Many states have simplified probate for estates below a certain amount, but that amount varies among states. A living trust, created while you're alive, lets you control the distribution of your estate. You transfer ownership of your property and your assets into the trust. If a living trust is properly drafted and executed, it can avoid probate because the trust owns the assets, not the deceased. A will is a legal document that dictates how to distribute your property after your death.