Are There Different Types of Trusts to Use in Estate Planning?
Did you know that trusts can be useful to many different people, not just those who are wealthy? Did you know that there is more than one type of trust? In fact, there are many different types of trusts that can be useful in estate planning, and many people may find that a specific type of trust may be well suited to their estate planning needs. If you have assets like a mortgage-free home or investment account that you want to pass on to your children while avoiding the lengthy probate process, you may wish to create a trust that allows you control of your assets now but gives them directly to your children later. If you have a child with special needs, you may want to set up a special needs trust. Or if you have the desire to leave money to your heirs while also making philanthropic bequests, you may want to look into a charitable trust.
In most states in the United States, anyone with assets over a certain amount will have to have their estate go through probate. This amount is as little as $20,000 in some states, and up to $200,000 in others, so it is important to check the rules where you live. Since probate can be a lengthy process and it can be tough for your personal representative as well as your heirs, you may want to look into creating a revocable trust. Revocable means the terms of the trust agreement can be changed at any time you wish prior to your death. You may act as the trustee for your own trust and manage the assets during your lifetime; you simply need to name a successor trustee who will manage or distribute the assets after your death. You can even include a provision in your will stating that any assets not contained in the trust that you own at your death will be placed into your trust. These assets are “poured” into your trust, which is why it is sometimes called a “pour-over” trust provision. A revocable trust can often be a good choice for those who want their heirs to avoid probate but also want to continue managing their own assets until that time.
Our office remains committed to creating solid estate plans that meet the unique needs of our clients. For assistance in estate planning and related legal matters, please contact our office to schedule an appointment.