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Question:

I am the executor for my 89-year-old aunt in NYC. She recently spoke with a lawyer about updating her will and he recommended creating a revocable trust to avoid probate even though she has beneficiaries for all of her financial accounts. The lawyer said that without a trust there could be issues with other people entering her apartment. What do you recommend (and why)?

Response:

Though I’m generally a proponent of revocable trusts for a variety of reasons, it sounds like it wouldn’t make much of a difference for your aunt or you as her executor. At her death, all the financial accounts will pass to the named beneficiaries. A revocable trust could ease the process since you would be able to contact the financial institutions on behalf of the beneficiaries. Otherwise, each of the beneficiaries will have to contact each financial institution on their own.

Revocable trusts also provide benefits during life. If your aunt’s accounts were all titled in her revocable trust and you were named as co-trustee, you could help her manage her finances and step in easily if she ever became incapacitated. Revocable trusts often work better than durable powers of attorney in this regard.

But I don’t see what the revocable trust has to do with someone entering your aunt’s apartment. I’m assuming it’s a rental apartment. If, however, your aunt owns the apartment, a revocable trust would avoid probate and allow you to step in upon her death without having to go to the trouble and delay of being formally appointed as executor by the probate court. In that case, perhaps the argument is that until you were appointed you would not have control over the apartment and someone else might enter it, but my experience is that in most cases everyone honors the executor in this regard even before they have their formal appointment in hand.

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