Have you ever wondered what will happen to your assets after you’re gone? How do you ensure that your assets end up in the right hands? How will you protect your family and make sure they’re taken care of? This is where a trust for estate planning comes in handy.
What is a Trust for Estate Planning?
A trust is a legal fiduciary arrangement that allows you to set up your assets to be held and managed by a third party. This party is known as a trustee, and the person or firm you appoint to this role will be responsible for ensuring that your estate is handled in the manner you’ve outlined.
There is a common misconception that an estate planning trust is only suitable for the extremely wealthy. But in reality, they can be beneficial for anyone, no matter the size of your estate and assets.
Here are five major reasons you should consider a trust for estate planning:
1. Avoid Probate Issues
The probate process is long, tedious, and expensive. Probate involves filing and reviewing the will to ensure its validity as well as appointing an executor to manage the estate assets. Property held in a trust, however, is considered non-probate, meaning it avoids most of these problems, saving you precious time and money.
2. Protect Your Estate From Creditors
If you leave unpaid debts behind, banks or the institution you owe money to may make a claim on your estate. When your property is held in a trust, creditors will have a harder time obtaining trust assets. A trust for estate planning assures that your assets are less likely to go to debt collectors.
3. It is Distributed Automatically
A trust for estate planning automatically distributes your assets according to the terms of the trust agreement. This means your loved ones won’t have to go through probate and wait for the court’s approval to access your assets.
4. See the Benefits of a Living Trust
There are two main types of trusts for estate planning. One, the testamentary trust, is only triggered after you pass away. However, a living trust can come into effect while you are still alive. It allows you to see the benefits of a trust during your lifetime, and when you pass away it automatically distributes your assets to your beneficiaries.
5. Tax Exemptions
When your estate is distributed under a will, it is subject to state and federal taxes. Plus, it will be liable to pay any taxes you didn’t pay during your lifetime, reducing assets intended for your beneficiaries. Funds held in a trust are protected from some taxes.
Estate Planning Experts
At DaMore Law, we can help you create a trust for estate planning to protect your assets, estate, and your loved ones. We will advise you on the options available to you and help you establish a plan that best suits your needs. Contact us to speak to one of our attorneys and gain the peace of mind that comes from being prepared for the future.