Sometimes, choosing who receives your assets gets complicated. What happens if your children are still minors in the event of your death? Who will be responsible for their inheritance? These questions and more must be answered clearly in your estate plan if you want to ensure proper distribution of your assets.
Thankfully, you don’t have to attempt to figure this out on your own. At Hable Law, I create trusts specifically designed for your unique family and needs.
How Do I Know If I Need a Trust?
There are various reasons why a trust might be beneficial to you and your family. Some of these reasons include:
- You have minor or young adult children or grandchildren and wish to protect their inheritance until they are older in the event of your death
- You want to simplify how your assets will be transferred in the event of your death, especially if you have a large family or you own real estate in other states
- You want to plan for how a unique asset can be passed down through the family, such as a family cabin or vacation condo
- You want to prevent difficulties among your beneficiaries
A trust gives you the benefit of being specific with who receives your assets when they receive them and how. Trusts give another party, the trustee, the right to manage assets for the benefit of a beneficiary in the event of your death. They provide legal protection, reduce the need for paperwork and avoid court oversight.
Testamentary Trusts
Testamentary trusts are created inside of a will and only become effective if certain conditions are met. Normally these conditions include the event of your death if your children are under a certain age, which you can choose. These trusts are strongly recommended if you have children who are minors or young adults.
Living Trusts
Living trusts are created when you sign them, as opposed to a testamentary trust that gets put into effect after death.
Living trusts can be amended and revoked during your lifetime, then become permanent in the event of your death. Living trusts can also help you avoid probate, or a court process, which is the reason most people are familiar with this type of planning. Often, these types of trusts are chosen for blended families, for individuals with real estate in more than one state, or for anyone with privacy concerns. They’re also a good choice for people who value planning for contingencies such as what happens if a child dies and you want to protect assets for your grandchildren. These are also called revocable trusts or inter vivos trusts.