Q: Do I Need a Trust?
A: If you want to have longer-term control over your assets-even after your death-you may want to consider a trust. This can be especially helpful if you have a child with special needs or whom you would not want to have a large sum of money all at once. With a trust, you can help ensure your legacy continues according to your wishes.
Q: Does my estate need to be a certain size for a Trust?
A: No. Trusts are not just for the wealthy. Legal mechanisms in a trust allow you to put conditions on how and when your assets will be distributed. This is especially useful to protect underage children, no matter how well off you may be. Trusts can prevent probate court delays and can protect loved ones from creditors or lawsuits.
Q: What are the Benefits of a Trust
Trusts can have many different uses-and there is no right or wrong type of trust. The one you choose depends on your circumstances and goals, how much control you seek, and your estate-tax strategy. When properly drafted and funded, trusts can:
- Protect your children and grandchildren
- Maintain control of assets long after your death
- Preserve funds for educational expenses
- Hold life insurance proceeds for children or the family business
• Manage income and estate taxes
Generally speaking, trusts give your beneficiaries financial support from your assets, while limiting the amount that can be withdrawn annually, and provide prudent investment management of the inheritance.
Q: What are the types of trusts?
A: The possibilities are nearly endless. The many types of trusts to choose from include:
- marital deduction trusts ("A/B" Trust)
- qualified terminable interest property trusts ("QTIP"),
- bypass or credit shelter trusts
- life insurance trusts ("ILIT")
• special needs trusts
To assess which trust would be most beneficial to you, consult an estate planning attorney by clicking here.