topic | life planning - legacy

Step 8: creating a trust

Trusts are a common part of an estate plan. A Trust may be advantageous over a Will or in combination with a Will because it:

  • bypasses probate
  • reduces or avoids estate taxes
  • manages property on behalf of the decedent
  • minimizes time required to distribute assets
  • protects assets given to minors
  • maintains privacy regarding the estate

There are many types of Trusts with multiple names and different purposes. Examples are:

  • Revocable Living Trusts
  • Irrevocable Living Trusts
  • Charitable Trusts
  • Charitable Lead Trusts
  • Insurance Trusts
  • Spendthrift Trusts
  • A/B Trusts
  • Special Needs Trusts
  • Testamentary Trusts

A grantor may wish to incorporate one or more Trusts in the estate plan. It is important to have an estate attorney or trust services provider explain what Trust, if any, fits the estate plan. As an example, a Revocable Living Trust is common for avoiding probate. Keep in mind that Trusts come with set-up costs and may include ongoing fees.

The Legal Documents and Legal Contacts forms may be helpful in recording the information related to Trusts.

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