Lady Bird Deed vs Living Trust in Florida — Which One Do You Need?

Published by Season Spanski, Esq. | Estate Planning Attorney

Both Lady Bird Deeds and living trusts avoid probate, but they work very differently. A Lady Bird Deed only covers your home. A living trust can hold everything you own. Choosing between them depends on what you own, what you want to accomplish, and how much you want to spend.

Let me break down both options so you can figure out which one makes sense for your situation.

What Is a Lady Bird Deed?

A Lady Bird Deed (enhanced life estate deed) is a simple document that transfers your Florida home to your beneficiaries automatically when you die. You keep full control while you're alive — you can sell the house, refinance it, or change beneficiaries anytime. When you pass away, ownership transfers immediately without probate.

Lady Bird Deeds are cheap, fast, and effective for real estate. But they only work for property. Your bank accounts, vehicles, and other assets still go through probate unless you have other planning in place.

What Is a Living Trust?

A living trust (also called a revocable trust) is a legal arrangement where you transfer ownership of your assets to the trust during your lifetime. You control everything while you're alive. When you die, your trustee distributes assets to your beneficiaries according to the trust terms — no probate required.

Unlike a Lady Bird Deed, a trust can hold all your assets: real estate, bank accounts, investments, vehicles, personal property, and more. Everything in the trust avoids probate.

Lady Bird Deed Pros and Cons

Pros:

• Simple and affordable: Costs a few hundred dollars to create
• Avoids probate for your home: Transfers automatically at death
• Keep full control: Sell, refinance, or revoke anytime
• Preserves Medicaid eligibility: Not counted as a disqualifying transfer
• Maintains homestead exemption: Property tax benefits continue
• Step-up in basis: Beneficiaries inherit at current value for tax purposes

Cons:

• Only covers real estate: Other assets still need separate planning
• No control over timing: Beneficiaries inherit immediately at death
• No creditor protection: After you die, creditors can place liens on the property
• Doesn't help with incapacity: If you become disabled, no one automatically has authority to sell your home

Living Trust Pros and Cons

Pros:

• Comprehensive: Covers all your assets, not just real estate
• Avoids probate completely: Everything in the trust transfers without court
• Privacy: Trust terms stay private (unlike wills, which become public)
• Control over distributions: Specify when and how beneficiaries receive assets
• Incapacity planning: Successor trustee manages assets if you become disabled
• Useful for blended families: Ensures children from prior marriages are protected
• Multi-state property: Avoids probate in multiple states if you own property elsewhere

Cons:

• More expensive upfront: Costs $1,500-$3,000+ to create
• Requires funding: You must transfer assets into the trust (change deeds, retitle accounts)
• More complex: More paperwork and ongoing management
• Doesn't eliminate need for a will: You still need a pour-over will for anything not in the trust

Cost Comparison

Lady Bird Deed: $300-$600 in attorney fees plus $10-$15 recording fee. Total cost under $700 in most cases.

Living Trust: $1,500-$3,500+ depending on complexity. Includes the trust document, pour-over will, powers of attorney, and healthcare directives.

Both are far cheaper than probate, which typically costs $3,000-$10,000+ and takes 6-12 months.

Which One Should You Choose?

Choose a Lady Bird Deed if:

• You mainly own a home with modest other assets
• Your bank accounts have payable-on-death beneficiaries
• You want the simplest, most affordable option
• You're concerned about Medicaid planning
• Your beneficiaries are clear and won't fight

Choose a Living Trust if:

• You have significant assets beyond real estate
• You own property in multiple states
• You have minor children or want to control when beneficiaries inherit
• You have a blended family with children from previous relationships
• You want comprehensive incapacity planning
• You value privacy and want to keep estate details confidential

Can You Use Both?

Yes, and many Florida families do exactly that. You can create a living trust for your financial assets (bank accounts, investments, etc.) and use a Lady Bird Deed for your home. This approach offers maximum probate protection without having to transfer your home deed into the trust.

It's especially useful if you want your home to go to different beneficiaries than your other assets, or if you're concerned about Medicaid planning for the home specifically.

What About Just a Will?

A will doesn't avoid probate. Everything in your will goes through probate court, which takes 6-12 months and costs thousands of dollars. Wills are important for naming guardians and handling anything not covered by other planning, but they don't provide the probate avoidance that Lady Bird Deeds and trusts offer.

Most people need a will even if they have a trust or Lady Bird Deed. The will acts as a backup for anything you forgot to transfer.

Making the Decision

The right choice depends on your specific situation. During a free consultation, we'll review what you own, who you want to inherit, and what you're trying to accomplish. Then we'll recommend the most effective and affordable option for your family.

Learn more about Lady Bird Deeds, living trusts, or explore our full estate planning services.