Most people are familiar with Wills and their benefits for estate planning. Wills are one of the basic documents of estate planning, however, there are more instruments that can and should be used in your estate planning.
A Trust is a management relationship where one party holds and manages property for the benefit of others according to the terms that you outline before your passing. The person that manages is known as a trustee and the person or persons who receive the benefit are known as the beneficiary. Both the trustee and beneficiary are chosen by you.
The following are three benefits of having a Trust.
1. Property held in a Trust generally passes outside of probate.
Probate is a court process that serves the purpose of proving the validity of a Will. This process is oftentimes slow and sometimes can deviate from what the testator or the person who wrote the Will really wants to happen. Further, property must go through the probate process in the state in which the property is located, which means that the assets of one individual may be subject to multiple states. A Trust on the other hand generally avoids the probate process which means that your beneficiaries and affairs overall are taken care of much faster. This is especially true if you have a property in multiple states.
2. Trusts offer a level of privacy that Wills do not.
During the probate process assets are generally itemized and the process public. However, rarely are Trust assets itemized. Although the publication of your assets may not bother you, the extra level of privacy may be a protection for your beneficiaries who may be receiving rare items or a high monetary value of assets.
3. A properly written Trust will streamline the process in the event you were rendered incapacitated.
If at some point in your life, you were to become incapacitated a conservator and an additional representative would need to be appointed. Waiting for this appointment causes delays in the management of your affairs. However, a properly written Trust instrument can grant your trustee the ability to serve as your conservator in the event of your incapacitation.
End of life planning is a topic often avoided and can be kind of confusing due to the multitude of options for your desired outcomes. However, planning ahead can change the financial future of your loved ones for generations. Learn whether a Trust is right for you by reaching out to Gilchrist & Fields Law.