Working with an attorney, it should be your top priority whenever you are creating a trust for the purpose of estate planning purposes. A knowledgeable estate planning lawyer can help you to document your wishes and to ensure that they are protected in the right kind of trust.
One of the most common estate planning tips for people who invest is to get a trust to protect their assets, but that is general advice that does not delve into the different types of trusts that all have various benefits and even some disadvantages. When you place assets into a trust, they are shielded from probate court if this transfer is done appropriately. This can reduce gift or estate taxes and protect your heirs from expensive court processes, the publicity of probate court and this additional time.
Certain trusts, however, provide better protection against creditors than others. A family trust is a legally binding document that is used to create a financial legacy for your heirs. It can be revocable or irrevocable and are designed to manage your assets on behalf of your beneficiaries. The conditions of your family trust is very flexible and these trusts can also be set up for very specific situations such as for a family member with special needs. A living trust is a formal document that saves probate fees and reduces the potential for gift and estate taxes. They can also be irrevocable or revocable based on how you create them.
When you create a trust you can choose to support anyone you wish. Living trust let grantors decide how assets will be handled prior to and at death, whereas family trusts are meant to live beyond the grantor’s life. A living trusts can distribute the assets to anyone who’s named as a beneficiary when the grantor dies. Family trusts, however, are designed to benefit only the family members of the grantor. Set aside a time to meet with a qualified estate planning attorney to talk about your next steps.