Is a Living Trust Right for You?

For most Nova Scotians, a properly prepared will is all they need to direct their estate after death. But in certain situations — particularly where privacy, probate avoidance, or complex family circumstances are involved — a living trust may be worth considering.

This article explains what a living trust is, when it makes sense in a Nova Scotia context, and why it is not the right solution for most people.

What Is a Living Trust?

A living trust — also called an inter vivos trust, meaning "between the living" — is a legal arrangement where you transfer ownership of assets into a trust during your lifetime. You typically act as the trustee while you are capable, retaining full control over those assets. You name a successor trustee to step in if you become mentally incapacitated or when you die.

Unlike a will, a living trust does not go through the courts after you die. Assets held in the trust transfer according to the trust document directly, without probate.

Why Some People Choose a Living Trust

There are a few scenarios where a living trust offers genuine advantages:

Probate Avoidance

In Nova Scotia, estates that go through probate are subject to a probate fee based on the value of the estate. Assets held in a living trust pass outside the estate entirely and are not subject to this fee. For larger estates, this can represent a meaningful saving. The probate process also takes time — a living trust can allow assets to be distributed to beneficiaries more quickly.

Privacy

A will becomes a public document once it is probated. Anyone can request a copy. A living trust, by contrast, is a private document. Its contents never become part of the public record. This matters to some families — particularly where there are business interests, contentious family dynamics, or simply a preference for keeping financial affairs private.

Continuity During Incapacity

If you become mentally incapacitated, an Enduring Power of Attorney allows your attorney to manage your financial affairs. A living trust can serve a similar function — the successor trustee steps in to manage trust assets without any court involvement. For people with complex asset structures, this can provide a more seamless transition than relying solely on a Power of Attorney.

Multi-Jurisdictional Property

If you own property in more than one province or country, probate may be required in each jurisdiction separately. Holding out-of-province property in a living trust can eliminate the need for ancillary probate in other jurisdictions — a real practical benefit for some estates.

Why a Living Trust Is Not Right for Most People

They Are Significantly More Complex

Setting up a living trust is not a simple exercise. It requires careful legal drafting, and more importantly, it requires you to actually transfer your assets into the trust — a process called funding the trust. Vehicles, bank accounts, investment accounts, and real estate must each be retitled in the name of the trust. Any asset left outside the trust still passes through your estate and may require probate anyway.

Many people set up living trusts and then fail to fund them properly. An unfunded trust provides none of the benefits it was designed for.

They Cost More to Set Up and Maintain

The legal fees for preparing a living trust are substantially higher than those for a will. You will also likely need advice from financial and tax professionals to structure the trust correctly. And the trust requires ongoing attention — as you acquire new assets, they need to be transferred into the trust to remain within its scope.

You Still Need a Will

A living trust only controls assets that have been placed into it. Anything left outside — personal belongings, new assets acquired after the trust was established, or items inadvertently omitted — still passes through your estate. That is why people who establish a living trust should always have a will alongside it, sometimes called a pour-over will, to catch anything not covered by the trust.

Nova Scotia Probate Fees Are Not Prohibitive for Most Estates

In some jurisdictions, probate fees are high enough that avoiding them justifies the cost and complexity of a living trust. In Nova Scotia, the probate fee schedule is relatively modest compared to provinces like British Columbia or Ontario. For many estates, the fees saved through a trust would not offset the cost of setting one up.

What Most Nova Scotians Actually Need

For the vast majority of people, the right answer is a well-drafted will, an Enduring Power of Attorney, and a Personal Directive. These three documents cover what happens to your estate after you die, who manages your finances if you cannot, and who makes healthcare decisions on your behalf if you are incapacitated. They are far simpler and less expensive to prepare than a living trust, and they handle virtually every situation that most families face.

A living trust is a tool for specific circumstances — larger estates, multi-jurisdictional property, strong privacy concerns, or complex family situations. If you think your situation might warrant one, the right step is to speak with a practicing estate planning lawyer who can assess whether the cost and complexity are justified by the benefits in your case.