In these present times, the management and disposition of wealth and property of an individual are now governed by law. Known as law of trusts and estates, it governs the allocation of wealth of an individual upon his incapacity or death. In civil law, it is called the law of successions.

One of the major factors for this law is to minimize the exposure of properties to taxes. If a person whose will is invalid or has not made one, his properties may be exposed to possible taxation and government control. Because of the deceased person’s inability to make a will that would otherwise name the right beneficiary to any or all of his properties, the inheritable properties may have to undergo a probate before these properties are finally distributed to the beneficiaries and heirs.

Probate, though legal, is a lengthy process and may also be expensive. The court which has jurisdiction over the decedent’s property has the legal right to supervise the process. An estate or real property may undergo a probate if the deceased does not have a valid will or does not mention the final beneficiary on his will. In some cases, when the surviving spouse does not instantly succeed to the property of his deceased spouse, the estate may go on a probate, whether there is a valid will or not.

To avoid probate, individuals would have to have an estate planning that would aid them in managing their estates and other inheritable assets. Estate planning is a process, whereby a property owner employs tools that can help him in managing the accumulation and disposal of a real property.

Avoiding the process of probate and involvement of probate court is one of the goals of estate planning. Aside from it, an estate owner has to make sure that his beneficiary or beneficiaries can receive the greatest amount of proceeds of his estate.

Moreover, estate planning can be employed by an estate owner during his incapacity. When a part or all of his estates and other properties are put in a trust, the trustee that he is assigned to handle the property can help him in distributing his wealth for supporting his entitled beneficiaries. It may also involve designation of guardians for his beneficiaries during the time of the estate owner’s incapacity or death.

One of the estate planning tools that an estate owner can employ is a living trust. This kind of trust can be created by the estate owner during his lifetime. The purpose of this trust is to permit assets that can be inherited to heirs and beneficiaries without undergoing the process of probate.

In living trust, the estate owner elects to transfer the title of his wealth and other assets to a trust. A trust may be a lawyer or professional who has the capacity to perform the jobs as mentioned on the written trust. It could also be a company such as a financial institution or any organization such as a charitable foundation.

In a trust, the estate owner becomes the grantor or trustor. He is responsible for the creation of a trust. He is also called a settlor for his ability to fund the trust. The trustor conveys the title as well as the management of his assets to the trustee.

During the lifetime of the trustor, the written trust is known as revocable living trust. Thus, any changes the can be made on his part can still be valid. Upon his death, the written living trust becomes irrevocable. The trustee may become the successor trustee who is now entitled for the management of the trustor’s assets. He may also have the right to make certain transactions for the management of assets inside the trust.  Nevertheless, the primary responsibility of the successor trustor is to distribute the assets under trust to the remainder beneficiaries.

There are many other kinds of trusts that an estate owner can deliberately employ for the management of his assets and for the attainment of his goals during his lifetime and his death.