When most people think about estate planning, a document known as a last will and testament comes to mind. While a will is certainly a central and essential component to any comprehensive estate plan, there are a number of other important estate planning documents that can provide numerous advantages, protections and benefits.
Individuals who take the time to consider and plan for how their assets will be distributed after death want to ensure that the maximum amount of wealth is passed on to future generations. Trusts are an estate planning tool that can be used to accomplish a variety of financial goals.
For example, wealthy individuals may use a trust to avoid paying estate taxes. Additionally, a trust may be used to provide financially for a loved one with special needs while still protecting their eligibility for disability benefits.
Trusts can also be used in cases where a beneficiary may be too young or irresponsible to inherit a lump sum of money. In these cases, a trust can be established under strict provisions to provide for the basic needs of a beneficiary until they reach a certain age or for a certain number of years.
As with most estate planning matters, the type of trust or trusts an individual chooses can and should be specifically tailored to specific needs and goals. An attorney who is experienced at handling estate planning matters and trusts can answer questions, provide advice and assist in ensuring trusts are established in a way to accomplish agreed upon goals.
Source: Post Crescent, “Do you need a trust? It depends on your estate,” Carissa Giebel, Nov. 2, 2013