What is the difference between a living trust and a Lady Bird Deed? If you’re a Michigan homeowner looking for a simple way to avoid probate, you may have heard of the Lady Bird Deed. It’s popular, low-cost, and commonly used across the state to pass down real estate, especially here in Oakland.
But while a Lady Bird Deed works well in limited situations, it isn’t always the best long-term solution. As a Michigan-based wills and estates lawyer, I see many cases where a revocable living trust offers more flexibility, protection, and peace of mind.
Let’s explore both to learn whether a living trust vs Lady Bird Deed is better for you.
What Is a Lady Bird Deed?
In Michigan, a Lady Bird Deed (also called an enhanced life estate deed) allows you to keep control of your home during your lifetime, but automatically transfer it to someone else, like your child or spouse, when you die. This avoids probate court for that property.
It’s attractive because:
- It’s affordable to set up.
- You keep full control of the property while alive.
- It bypasses probate after death.
However, that’s where its advantages end.
Why a Living Trust May Be a Better Fit
Here in Rochester Hills, we often see families who start with a Lady Bird Deed but later realize they need a more complete plan. That’s where a living trust comes in.
A living trust is a legal document that holds ownership of your assets while you’re alive, allows someone you trust to manage them if you become incapacitated, and distributes them as you want after you die, without court involvement.
Here’s why it may be a better fit than a Lady Bird Deed:
- Covers More Than Just Your Home
A Lady Bird Deed only addresses one asset: real estate. A trust can include your home and your bank accounts, vehicles, investments, and personal belongings. It’s a true all-in-one solution.
- Protects You if You Become Incapacitated
A Lady Bird Deed doesn’t help if you become unable to manage your affairs. A trust includes backup plans, giving someone legal authority to step in and help without court involvement.
- Gives You Control Over How Inheritance Is Handled
Want your kids to receive their inheritance gradually or after reaching a certain age? A trust can do that. A Lady Bird Deed gives them the home immediately after death, no strings attached.
- Reduces the Risk of Family Disputes
A trust is private, detailed, and harder to contest. In contrast, a Lady Bird Deed can create tension if there’s more than one heir or the family feels something was done unfairly.
- Better for Multiple Properties
If you own more than one property in Michigan (or out of state), you’d need multiple deeds. A trust can hold all your properties, no matter where they’re located.
The Bottom Line On Which One Is Better – Living Trust vs Lady Bird Deed
A Lady Bird Deed can be a helpful shortcut for some people. But if you:
- Own more than just a home,
- Have a blended family,
- Want to protect yourself in case of incapacity,
- Or want to control how and when your assets are distributed,
Then, a revocable living trust may be the better choice for your Michigan estate plan.
Ready To Explore Your Estate Planning Options?
We help families make informed, confident decisions about their future. Contact our office today to schedule a consultation and find out which plan is right for you. Book your free consultation. We are located in Rochester Hills and serve Oakland, Macomb, Genesee, Lapeer, Livingston, and Wayne Counties.
Follow us on Facebook and Instagram for the latest news.
Related: Why Updating Your Estate Plan And Trust Is Important When You Move Into A New Home