When California residents want to protect their financial future and that of their children or loved ones, they may decide that it is time to draw up a trust. However, there are certain decisions regarding trusts that they will have to make. These decisions will be different based on their individual needs and circumstances.
There are three important parties involved in a revocable living trust. The settlor is the person who sets up the trust, and is often the trustee as well. Settlor-trustees still have access to any money that may be put in while they are still alive. If the trustee dies, the new trustee who was chosen by the old trustee then has control over the money. The trustee will be able to take money out of the trust, but the money must be used to support the beneficiaries.
The actual trust can be customized based on the settlor’s family circumstances. For example, a trustee may decide that the children can only have access to the funds when they reach a certain age. Some may have different provisions for different children. The trust can be changed and adjusted over time depending on how the family circumstances change once the trust is initially drafted.
Proper estate planning can prevent potential family disputes in the future. An attorney may assist with creating a customized estate plan that protects a client’s financial assets and other important property. When drafting the revocable living trust, the attorney will point out that it does not become fully effective until it is funded. This may require retitling certain assets such as real property into the name of the trust.