What's a Revocable Living Trust - Shopping Cart Analogy

I often explain the concept of a revocable living trust by relating a story from the early days of my marriage.

More than thirty years ago...

My wife and I were married in Bethesda, Maryland, and honeymooned briefly in the Poconos in Eastern Pennsylvania. We drove across the country to Utah where I was finishing my bachelor’s degree. After signing our new apartment lease and unloading our meager belongings, my beautiful bride told me that we had to make a quick trip to the grocery store for just one item before we crashed for the night.

Holding All Your Stuff Personally

At the store, I breezed past the little red baskets and the push carts. In the pharmacy section, she handed me a bottle of hair conditioner. I turned to leave, but we weren’t done yet. Next came a bottle of shampoo, then soap, then lotion…then my wonderful wife told me that our fridge was empty, and we should pick up some groceries while we were in the store.

Too many groceries to comfortably hold.

Soon, I was staggering down the aisle with my sweater extended like a pouch with a gallon of milk in one hand and gallon of orange juice in the other. My bride was looking for the next spot to set another item, and I was trying to balance the load with my chin on top of a dozen eggs. Just picture that!

Now, in terms of estate planning, that situation is somewhat like personally “holding” or “owning” all your assets. If you “fell down,” or so to speak, there would be a big mess on Aisle Nine. That mess, in estate planning terms, is an estate administration or probate action. In essence, if a person dies, the only way to transfer substantial assets is by getting a court to grant the authority (Letters Testamentary) to the appointed personal representative (Executor). After all, the deceased person can’t sign any documents so someone has to get the authority to do it.

Only the judge can grant the authority.

Note: A Last Will and Testament does not allow your heirs to avoid probate. Instead, it’s sort of

like a set of formal instructions to the judge. The Will indicates who will be in charge, who your heirs are, and what property will pass to which heirs.

So, What About a Shopping Cart?

Smart.

On the other hand, if I had taken a shopping cart, it would have been much more convenient. That’s a revocable living trust. Basically, just like a shopping cart, you can put property in it or take it out. If the person “controlling” or pushing the cart falls down, the stuff inside isn’t disturbed…and the next person (the successor trustee) simply puts their hands on the cart and takes control. The shopping cart or revocable living trust becomes a vehicle for transferring your assets without the delay and cost of a court administration – so long as the relevant property has been funded into the trust. (For questions about funding your trust, see my other posts below.)

Conclusion: The simplicity and convenience of a revocable living trust plan is as straightforward and clear as the ease of using a shopping cart. Any property you put in the trust can be managed and transferred by the trust. This allows you to avoid the potentially expensive and messy aspects of an estate administration as well as other substantial benefits that I don’t have time to address in this brief post. As always, seek professional guidance when preparing and funding a reliable estate plan.

Curry Andrews, Attorney