most estate plans can benefit from a trust
Revocable and Irrevocable Trusts
Unless you grew up in a wealthy family, you probably think that trusts are only for them. And, maybe you have a lot of money and still don’t like the idea of trusts. In fact, a trust can be a very important part of many, I would say most, estate plans. Trusts can protect your assets during and after your life. They can allow you to provide gifts and legacies for your family as they reduce the likelihood that such assets will be misused, wasted or otherwise depleted. A trust can be arranged so that you keep ALL control of such assets during your lifetime, or, intentionally, give up control and/or benefits for various later-life planning.
Just like a will, a trust must be executed such that it meets the statutory requirements. Witnessing must be done properly as well as insuring that the Grantor (owner) is competent to sign. Competency is a common challenge to various estate planning documents.
A trust can have the following attributes:
- Usually, you would be the first trustee
- It identifies your desired successor trustee and, many times, the secondary successor trustee
- It clearly identifies your desired beneficiaries plus how and when they are to receive benefits
- As in a will, it provides an opportunity to exclude someone who might normally have been a beneficiary
- It instructs what is to be done if one of your primary beneficiaries predeceases you
- It allows “just in case” distribution rules so that a beneficiary who gets in a bind from drug addiction to being swamped with debt to being in a divorce proceeding might be protected
- It can protect those who have special needs supported by government assistance such that their benefits can be used to give them a life beyond what the support gives
- Should a beneficiary be young, you can time the distributions rather than give an 18 year old lots of money to go through before they learn how to handle it
- It also gives witness to the fact that you were of a proper state of mind to execute you will
Your trust becomes an extension of you once you pass on. It could guide things for generations