What Is a Living Trust in Singapore?

living trust singapore

A living trust is a powerful instrument that individuals in Singapore can use to secure the smooth management and distribution of their assets both during their lifetime and beyond. While you may already be familiar with wills, a living trust in Singapore offers distinct advantages, providing a flexible and efficient way to protect one’s wealth.


In this article, discover the intricacies of living trusts in Singapore, their benefits, and the essential factors for consideration.


Understanding Living Trust Singapore

A Singapore living trust, also referred to as an inter vivos trust, is a legal arrangement wherein you, as the settlor or grantor, transfer your assets into a trust while you are still alive. As a settlor, you designate a trustee to manage your trust assets on behalf of your beneficiaries.


The living trust is often revocable. This means that you retain control and have the ability to modify or dissolve the trust according to your needs at any given time.


Benefits of a Living Trust

The benefits of a living trust Singapore are many, making it a highly appealing and effective estate planning strategy for individuals looking to secure their financial future and protect their assets during their lifetime.


One of the main advantages of a living trust is the ability to avoid the often time-consuming and costly probate process. Unlike wills, which are subject to probate, a living trust allows assets to be transferred to beneficiaries outside the probate process. This ensures that your beneficiaries can receive their inheritance in a more efficient manner, providing them with financial stability.


Moreover, a living trust offers flexibility and continuity of management. It allows the grantor to modify or revoke the trust as circumstances change over time. This ensures that your trust remains aligned with your evolving financial goals and family dynamics. You can specify detailed instructions for asset management and distribution, giving you greater control over your estate.


Additionally, living trusts afford a higher level of privacy compared to wills since they do not become part of the public record. Remember that wills are subject to probate proceedings, which can expose personal and financial details to the public eye. Conversely, living trusts maintain confidentiality and protect your sensitive information, allowing you to handle your estate matters discreetly.


Indeed, a living trust Singapore is a comprehensive and advantageous estate planning tool that offers significant benefits. And by understanding these benefits, you can create a customized and robust plan to protect your assets and secure your loved ones’ financial future.


Creating a Living Trust

Now that you understand what a living trust is and its benefits, the next step for you is to create one in Singapore. And to help you with the process, here are some tips:


First, seek professional advice. Before creating a living trust, it is necessary that you consult with a lawyer or an estate planner. They will assess your personal circumstances and guide you throughout the entire process.


Next, identify your assets. It would be very useful for you to list all of your assets that you intend to transfer into a trust. You may include your bank accounts, investments, and personal belongings.


Third, appoint a trustee. Choose a trustee who will manage your trust assets and fulfill your wishes. A trustee can be an individual, a corporation, or a combination of both. Consider their ability to handle financial matters and their willingness to act in the best interests of your beneficiaries.


Fourth, draft the trust deed. With the help of a lawyer, draft a clear and comprehensive trust deed that reflects your true intentions and desired provisions. It is essential to be meticulous during this process to avoid any ambiguities in the future. Also, don’t hesitate to ask questions or get clarifications from your lawyer as you work on the trust deed.


And lastly, fund the trust. Transfer the ownership of your identified assets into the living trust. This likewise involves re-registering your assets and updating account titles accordingly.


The Bottomline

A living trust Singapore represents a powerful tool for asset protection. By understanding its benefits, creation process, and key considerations, you can surely make an informed decision.

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