Do you need a Trust?
This is the primary question asked by many of our estate planning clients. Which is why we’re offering our top 10 reasons to consider a Trust.
Keep in mind there are many different types of Trusts, one size does not fit all, and if this is something you’re considering, it’s best to schedule a consultation to find out what is best for you and your situation.
1. You don’t want your estate to go through probate.
While the probate process has gotten more cumbersome due to budget cuts and less help at the courthouse, as an attorney I can assure you we will take good care of your affairs if your estate goes through probate. However, if it can be avoided, your loved ones will thank you.
2. You prefer privacy.
Once you pass away and your will goes through probate, it becomes a public document. You might not care if this happens, however your family and/or beneficiaries will be mentioned in the will which means all of this information will now be made public. Regardless of your status, privacy can be very important. If this concerns you, create a Trust.
3. You want to make it easier for the person who will handle your affairs if you become incapacitated or after you pass away.
Practically speaking, it’s easier for a successor (or Trustee). Having a Trust makes it easier to get control of your assets and to act ‘as you on your behalf,’ than it is for that same person when they are named as agent under a power of attorney or as executor of your estate. With a Trust, you get to dictate exactly what, when and how.
4. You have a complex situation.
Most people don’t think their affairs are complicated. They view their estate as “simple.” However, once they become incapacitated or die, it becomes apparent that things are not so “simple.” By placing your assets into a Trust, you make things much easier for your successors to manage your assets, and in the manner you intended. This can be particularly important if you feel there could be confusion or any familial conflicts.
5. You have complicated distribution plans.
Let’s say you want to limit how much of an inheritance a beneficiary is to receive at certain points in time. By having a Trust in place, you will be able to have more control over how much the beneficiary receives and when they receive it. This can be very helpful if your beneficiary is young or challenged in any way.
6. You have real estate in more than one state.
What could be worse than having your estate go through probate? Having to go through probate in two states. Even though probate is probably not as difficult as you might think, why would you want to do it twice? That’s exactly what happens if you own real estate in more than one state. Your estate would have to go through the process in each state, and each state will have its own complications and costs. If you have real estate in more than one state, you should defiantly consider a living Trust.
7. You have professional children, or wealthy children.
If your son is an anesthesiologist, and your daughter is an investment banker, you might think, “why would they need their inheritance in a Trust?” They probably don’t, but by putting it into a Trust you are actually giving them a gift. You can help protect their inheritance from creditors, malpractice claims, and even divorce proceedings, and you might be able to keep your assets out of their estates when they die, thereby reducing the amount of estate tax the grandchildren pay.
8. You have minor children, or children, or grandchildren.
Think about some of the decisions you made when you were younger. Would you make the same decisions again if you knew then what you know now? Probably not. Which is why it’s best to leave an inheritance for a child in a Trust until a certain age when they will (hopefully) be in a position to make better decisions about the use of the funds.
9. You have a family member who is not good with money.
If you have a beneficiary who is not particularly great with money, or you’re concerned their spouse may not be, you might want to provide some sort of management for that beneficiary’s share of your estate. A Trust is great for that!
10. You have a child or grandchild with a disability who is receiving public benefits like Supplemental Security Income (SSI) or Medicaid?
You may need to create a special needs Trust for any share they will receive. Even if they are not on public benefits now, you may still want to consider a special needs Trust, because you don’t know how things will change over time. The same rules apply for any person you plan to leave money to, including your long-time housekeeper’s son or the young woman who grew up with your kids and was treated like a member of the family. We just use “child or grandchild” because they are the most common recipients.
Do any of these reasons resonate with you? If so it’s time to set up a FREE consultation to discuss if having a Trust as part of your estate plan makes sense for you.
Here at Tacoma Elder Care we are all about helping you set up a plan that works best for you, so that you can retire knowing you don’t have to worry.
Click HERE to set-up your FREE consultation today!