Living trusts enable you to place assets into a trust during your lifetime while maintaining the ability to manage and use the assets without restriction. Upon your death, your assets can be distributed to your beneficiaries in such a way that avoids probate, allows you to maintain some level of control after death, and provides the possibility of creditor protection for your beneficiaries.
Why Should I Consider Creating a Living Trust
Living trusts can be created for several reasons, but should always address three primary goals: First, a well-drafted living trust should provide planning for the possibility of your own incapacity; second, your trust should provide for how your assets will pass to your beneficiaries; and third, your trust should make after death administration of your estate as easy as conceivably possible.
During Your Lifetime
Suppose there comes a time when you’re either temporarily or permanently unable to manage your financial assets. In that case, your trust can provide guidelines on where you wish to live, how you want to be cared for, and many other details.
Your Beneficiaries
Trusts allow you to separate the control over your assets from the benefit that those assets can have on your loved ones. This can become critically important when minor children are left behind. Assets can be left in trust for minor children to prevent the necessity of a court-appointed guardian for the children’s estates. Additionally, it can prevent significant assets from being freely used by young adults who may still need to develop the financial and life skills to manage them properly. The trust can be designed to provide incrementally greater access, and control of assets as your children mature. Assets can also be placed in trust for your beneficiaries in such a way as to shield those assets from your beneficiary’s creditors or protect the assets in the event of a beneficiary’s divorce.
In addition to protecting your beneficiaries, your trust can be designed to provide your beneficiaries the opportunity to learn how to manage their own assets. It’s not uncommon to allow a beneficiary to become a co-trustee for a designated period of time before they are permitted to become their own trustee.
Other Benefits the Trust Provides
In addition to the basic trust techniques outlined above, a living trust can provide for the management of federal estate tax, address the possibility of remarriage if your death leaves behind a spouse, plan for post-death charitable giving, or any number of other advanced planning techniques.
Speak With An Estate Planning Attorney at Norton Pelt
The earlier you start your estate plan, the more options you have. At Norton Pelt, we will help you create a basic plan regardless of what stage of your life you are in. For professional legal counseling in conjunction with wills, trust, and powers of attorney, contact Norton Pelt to schedule your consultation.
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