Chartered Retirement Planning Counselor (CRPC) Practice Exam 2026 - Free CRPC Practice Questions and Study Guide

A Totten Trust is a form of revocable trust that allows individuals to designate a beneficiary to receive assets upon their death without the need for probate. When assets are placed in a Totten Trust, the individual retains control of the assets during their lifetime and can withdraw or change the terms of the trust as they see fit. However, upon the individual's passing, the designated beneficiary automatically receives the assets directly, bypassing the probate process entirely. This feature is particularly beneficial for ensuring that assets are transferred quickly and seamlessly to the beneficiary, avoiding the time-consuming and potentially costly probate proceedings typically involved with a will.

Others choices involve concepts that do not define how a Totten Trust operates in relation to the probate process. For instance, transferring assets subject to a will implies that those assets would go through probate, which is not the case. Additionally, the Totten Trust does not eliminate estate taxes; instead, it just provides a mechanism for transfers. Lastly, while assets are indeed transferred after the donor's death, the distinguishing factor of a Totten Trust is the avoidance of probate, making this option uniquely relevant in this context.