Creating a good estate plan for your family and for your peace of mind is valuable because it will ensure legalities will go smoothly, privately, and with much less expense than could otherwise be the case.

Also, leaving assets to loved ones protected from lawsuits (equitable distribution in divorce and most creditors) is valuable. In this litigious society, and with many marriages ending in divorce, where commingled assets can be lost in divorce, the solution is to leave assets to loved ones in trust for their benefit.

In addition, making sure your trusted loved ones have the authority to take steps for you to protect your assets, so they will not be completely dissipated due to long term care costs, is valuable.

Using a revocable living trust (RLT) instead of just a will can help you accomplish much of the above.

So, what is an RLT? It is an agreement you make with yourself that you can change and revoke. While you are alive, you (and sometimes your spouse) are the only people who can act regarding your trust property.

When you pass, the assets titled in your name as trustee of your trust DO NOT go through probate. This keeps your affairs private, and makes the cost much less in administering the legalities.

If you have real estate or a timeshare in another state, you should use an RLT so you can avoid having to go through probate (and hiring another lawyer) in that state.

Avoiding complete dissipation of your assets due to long term care costs can also be addressed. Also, steps can be taken with your primary residence (if owned by you, free of mortgage) to make it so you have total ownership and use while you are living, and that you preserve the 4% special assessment and homestead exemption and the full step-up in basis at death, while ensuring that if you go on Medicaid, the state WILL NOT get your house.

Imagine Jack and Jill recently moved to South Carolina to retire. They also own a house in Maine. Their South Carolina house is paid off and they will never do a reverse mortgage.

They do not have long term care insurance. They have two children, Jack Jr. and Jillian, and three grandchildren. What should they do?

They should use an RLT so they don’t have to go through full-blown probate in Maine or in South Carolina. They should leave assets to their children “in trust” so the kids can use the money, but so they will not lose it in a divorce or some other lawsuit, and so the assets stay in the family.

They can also make sure the South Carolina house will not be snatched up by the state if the survivor is on Medicaid.

Mark F. Winn, J.D., Master of Laws (LL.M.) in estate planning, is a local asset protection, estate and elder law planning attorney.