When it comes to estate planning, simplicity can be tempting. That’s why Lady Bird deeds (also known as enhanced life estate deeds) have gained popularity in states like Florida, Texas, and Michigan. They’re marketed as an easy, inexpensive way to avoid probate while retaining control of your property during your lifetime.
But here’s the uncomfortable truth: Lady Bird deeds often fail to do what people think they will—and they can cause more problems than they solve.
Let’s break down what Lady Bird deeds are, why they frequently go wrong, and why using a revocable living trust is typically a much safer, more comprehensive option.
A Lady Bird deed allows you to:
Retain full control of your property while you’re alive.
Automatically transfer the property to named beneficiaries upon your death—without going through probate.
Sounds good, right?
Not so fast.
A Lady Bird deed only controls one asset: the property named in the deed. It doesn’t coordinate with your will, your financial accounts, or other assets. If you later make changes to your estate plan (like naming different heirs in your will), the deed can override those intentions—leading to confusion, disputes, or even litigation.
If a named beneficiary dies before you, what happens to the property? Unlike a trust, most Lady Bird deeds do not allow for contingent beneficiaries or detailed planning for alternate scenarios. That means the property could go through probate anyway—exactly what you were trying to avoid.
While Lady Bird deeds are often touted as Medicaid-friendly, the rules vary from state to state and change frequently. Improper use can still affect Medicaid eligibility or result in estate recovery claims. Don’t assume you’re protected.
Not all lenders and title companies are familiar with or accepting of Lady Bird deeds. Some may refuse to refinance or insure the property without further documentation. That can cause expensive delays or require you to unwind the deed—undermining its purpose.
A Lady Bird deed does not protect the property from creditors during your lifetime—or the lifetime of your beneficiaries. If your heir has debts, gets divorced, or is sued, the property you passed on so easily may be seized or lost.
Now let’s look at what a revocable living trust offers by comparison:
A trust can hold all your assets—not just your home. That means your estate plan is coordinated across the board, with consistent instructions for your family and heirs.
Like a Lady Bird deed, a trust avoids probate. But unlike a Lady Bird deed, a trust provides clear instructions, flexibility for contingencies, and long-term oversight if needed.
If your beneficiary is underage, has a disability, or is bad with money, a trust allows you to delay distributions or appoint a trustee to manage funds responsibly.
Trusts do not become public record, unlike wills. And they keep your estate administration smooth and private—even if you become incapacitated.
While you may still need an irrevocable trust for advanced Medicaid planning, a revocable trust is a stronger starting point than a patchwork of Lady Bird deeds and account designations.
Lady Bird deeds seem like a quick fix, but they can create long-term headaches. If you want to truly protect your family, minimize disputes, and avoid probate while maintaining control, a properly funded trust is the far superior solution.
It’s worth spending a little more time (and legal fees) upfront to get an estate plan that actually works—rather than one that falls apart when your family needs it most.
When in doubt, talk to experienced estate planning attorney Jennifer L. Daly at Sandhill Legacy Planning. Don’t let your legacy depend on a shortcut.
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