Trusts are for rich people, right? Wrong. There are five key benefits of creating a trust, and they can apply to anyone who has the need to:
Protect assets. The list of people who have mismanaged assets, including spendthrift heirs, could paper many an estate planning lawyer’s office. By establishing a trust, you name someone (or a financial institution) to manage the assets that are placed in the trust, either for yourself or for trust beneficiaries. Not all of us are good at managing money and property; having a trust for this purpose relieves us of this important challenge.
Control assets. Just because you put money or property into trust does not mean you don’t still have control over those assets. When you create your trust, you have a choice of maintaining control of the assets over a certain time period, even after death in some cases.
Avoid taxes. If you are married and one spouse dies, assets pass to the surviving spouse without estate tax. But what if you are not married, or have children? By-pass trusts can be set up to hold assets for children and still provide use of the assets by a surviving spouse. After a surviving spouse dies, the assets in the trust then pass to the children free of estate tax.
Avoid probate. Assets placed in a trust are not subject to probate, since a trust is a separate entity and survives the death or the grantor.
Avoid conservatorship. A trust can avoid the need for a court-appointed conservator when a successor trustee is appointed to assume the management of the trust assets if the grantor becomes incapacitated.
The Flanigan Law Group provides Southern California residents with personal attention for estate planning, administration and litigation legal services. When disputes between families, arise, they are very successful in resolving legal estate issues quickly and efficiently while preserving financial and emotional resources. Contact the Flanigan Law Group at 949-450-0042.