What are the advantages of a revocable living trust?

A revocable living trust is a powerful estate planning tool that offers several key advantages, particularly in relation to probate and privacy. One of the primary benefits is that a revocable living trust can help avoid the probate process, which is the legal procedure through which a deceased person's assets are distributed. Probate can often be lengthy, costly, and a matter of public record, which can expose sensitive financial information. By placing assets in a revocable living trust, those assets are not subject to probate, allowing for a more efficient distribution to beneficiaries after death.

Additionally, a revocable living trust maintains privacy since the trust document does not become part of the public record as a will does when it goes through probate. This means that the details of the trust, including asset distribution and specifics about the beneficiaries, are generally kept confidential, offering a level of discretion that a will cannot provide.

Other options presented in the question do not accurately describe the benefits of a revocable living trust. For instance, while trusts can offer beneficial tax arrangements, a revocable living trust itself does not provide specific taxation benefits as it is often treated as a pass-through entity for tax purposes. Moreover, it does not guarantee a higher inheritance nor does it mandate a specific investment strategy, as it