Oh, the Places You’ll Go! “You won’t lag behind, because you’ll have the speed. You’ll pass the whole gang and you’ll soon take the lead. – Dr. Seuss
Trusts are not only for very wealthy or complicated estates. They can be a valuable tool for everyone seeking to provide for their families and protect their assets in the future. Most families do not have estate planning documents, and if they do have a plan it is most often only a will to pass their estate on to selected heirs. take control and plan your trust assets and brings confidence to the future for those you wish to leave parts of your hard earned property to.
Take control and plan your trust
A trust will allow the grantor, the individual who is setting up and funding the trust, very detailed control over the distribution of their wealth and the terms of said distribution. Additionally, it can also allow for the continued use of the assets while the funding individual lives. A trust is, at its heart, a legal arrangement for the transfer or property from the grantor to the trust. The trust is then controlled by a trustee for the benefit of another person, the beneficiary.
In some instances, the grantor and trustee can be the same person. For example, while the grantor still wishes to enjoy the use of their property, they can also be the trustee to make managing the trust easier. The trust will have provisions in place for the appointment of a second trustee upon the death of the first trustee in situations such as this.
Why you should consider take control and plan your trust
A trust manages who will receive distributions, as well as when and on what terms those distributions will occur. This can be especially helpful for families with children from multiple marriages. In the situation where a surviving spouse remarries, the trust can ensure that the children from the first marriage receive the inheritance you planned for them.
A properly constructed trust can protect the wealth of the trust from heirs’ creditors, or even from their own poor life decisions and habits.
A trust is beneficial to protect your assets from long term care costs like nursing homes and home health agencies.
Property in a trust avoids entering into probate if constructed properly and will save your heirs time and money probating all of your assets through the courts. The trust can pass property easily from you, to the trust, to your heirs with no government involvement.
If you are interested in contributing long term to a charity, you can maximize the tax benefit while donating assets in the way you desire using a charitable trust.
In the event that the grantor is incapacitated, a trust can be established and funded to provide for their care.
There are other reasons why a trust may be appropriate. Hiring the services of an estate planning attorney means that your unique situation is evaluated with a critical eye, and the estate plan is tailored to your specific needs. If a trust is right for you, a good attorney will guide you to the best choice.
Selecting the right kind of trust
The kind of trust needed for an individual is entirely dependent on their circumstances and goals. Working with a knowledgeable and experienced estate planning attorney will help you make the right choice from the beginning, give you peace of mind about your wealth’s future, and prevent you from having correct mistakes in the future.
A revocable trust can be altered or amended during the lifetime of the individual funding the trust. Assets can be moved in and out of the trust with ease while the grantor lives. After their death, the trust converts to an irrevocable trust and performs the same function a will does, enabling the trustee to process the grantor’s estate without going through the probate process.
An irrevocable trust can not be amended during the life of the grantor, nor can the assets in the trust be transferred once they are used to fund the trust. The trustee administers the trust for the benefits of the beneficiaries according to the terms spelled out in the trust. The purpose of such a trust is to remove assets from the grantor’s estate, and to avoid estate tax if that is an issue the grantor faces.
Life happens. Make and review your trust documents and estate plan.
Have a trust funded and an estate plan in place to protect those you care about most in the event the unthinkable happens. Some find having a plan in place brings peace of mind to them and their families.
Make sure that you review your needs as your life evolves. If you get married, have a child, divorce, receive and inheritance, you want to have your trust and estate documents reviewed for the best protection of you and your family possible. Even without a major life event it is a good idea to have the estate plan reviewed every five or so years, to make sure the goals you have match the goals the estate plan would carry out.