Does your estate plan need a trust?
Trusts are legal tools that allow the creator to distribute wealth in a manner that generally allows for more control compared to the use of a will. Trusts can help create an estate plan that better ensures the creator’s wishes are met.
Some examples of the goals that can be met with a trust include:
Control. As noted above, these legal tools provide a greater level of control than a typical will. A will generally distributes the assets outright while a trust can achieve a more controlled approach. The language used to create the trust can outline the use of payments from the trust. Common examples include the education of the beneficiary as well as costs associated with health and welfare.
Privacy. Trusts can also help to keep the creator’s estate out of probate court. Proceedings in probate court generally become public knowledge. As such, use of a trust can help to better ensure the details of the estate remain private.
Shelter from creditors. A recent publication by CNBC notes that these legal tools can also help to ensure assets remain separate if a beneficiary marries. This can help shelter the asset in the event of a divorce.
So is a trust right for your estate? These benefits may sound appealing, but the exact answer is best determined after seeking the counsel of an experienced attorney.
It is also important to note the power of the language used to craft these documents. The language must be worded carefully to achieve the intended goal. A failure to do so can result in unforeseen and undesirable consequences. An experienced attorney can discuss potential implications with you and help tailor a trust to meet your needs.