A client of mine, a retired executive in Manhattan, once faced a difficult situation. His wife, who had always managed their finances, suffered a stroke that left her unable to communicate. Because their brokerage account and the deed to their co-op were in both their names, he was paralyzed. He couldn’t sell stock to pay for her care or manage their joint assets without her signature. The only path forward was a lengthy and public guardianship proceeding in court—a process that felt like an intrusion during an already painful time.
This is a scenario we see too often. Many people believe a will is all they need, but a will only activates upon death. It does nothing to protect you or your family during a period of incapacity. A revocable living trust, on the other hand, is designed for life.
What “Inter Vivos” Actually Means
Lawyers often use the term “inter vivos trust.” It sounds complex, but it is a straightforward Latin phrase: “between the living.” This is a trust you create during your lifetime, distinct from a testamentary trust created by your will after death. I use the term “living trust” because it captures what the instrument does—it functions while you are alive.
When you establish a revocable living trust, you typically play three roles at the outset:
- The Grantor: The person who creates and funds the trust. This is you.
- The Trustee: The person or institution that manages the trust assets according to its terms. Initially, this is also you.
- The Beneficiary: The person who benefits from the trust. During your lifetime, this is you.
You transfer ownership of your assets—your home, your bank accounts, your investments—from your individual name into the name of the trust. Because you are the trustee, you retain full control. You can buy, sell, and manage the assets just as you did before. Because the trust is revocable, you can change its terms or even dissolve it entirely at any time. Nothing is locked in stone.
The Primary Goal: Avoiding Surrogate’s Court
The most widely understood benefit of a living trust is that it allows your estate to avoid probate. A will does not avoid court; it is essentially a letter of instruction to the Surrogate’s Court. The will must be validated, assets inventoried, creditors paid, and distributions approved by a judge. This process can take months, sometimes years, and it creates a public record of your assets and beneficiaries.
A trust, however, is a private agreement. Assets held by the trust are not part of your probate estate. Upon your death, the person you named as the successor trustee takes over. They have the immediate authority to manage the assets and distribute them to your beneficiaries according to the instructions you laid out in the trust document. No court proceeding is required, no lengthy delay, and no public filing.
These private agreements derive their legal force directly from New York law. Article 7 of the Estates, Powers and Trusts Law (EPTL) provides the framework for creating and administering trusts, allowing families to manage generational wealth with privacy and efficiency.
A Plan for Incapacity, Not Just Death
While avoiding probate is a significant advantage, the most profound benefit of a living trust is its function in managing incapacity. Stewardship is about planning for all contingencies, not just the final one.
If you become unable to manage your own affairs due to illness or injury, the successor trustee you appointed—perhaps a spouse, a trusted child, or a corporate fiduciary—can step in immediately to manage the trust assets on your behalf. They can pay your bills, handle your investments, and ensure your financial life continues without interruption. This seamless transition avoids the need for your family to petition a court to have you declared incompetent and have a guardian appointed.
A guardianship proceeding is a public, expensive, and often emotionally draining process that strips an individual of their autonomy. A properly funded living trust is a deliberate act of foresight that protects your dignity and shields your family from that difficult ordeal. It ensures the person you chose is in control, not someone appointed by a court.
A trust isn’t just a legal document. It’s the framework for your legacy and a plan to protect your family from chaos during a crisis. It is one of the most effective instruments we have for ensuring your wishes are carried out with precision and privacy, both during your life and after.
Before you can place your assets in a trust, you must first have a clear picture of what you own. We suggest starting by creating a simple list of your major assets—real estate, bank accounts, investments. Once you have that inventory, we can schedule a call to discuss how a trust could be structured to manage them.
