Posted on: 15 June 2021Share
Should you add a trust to your estate plan? While some Americans' estate planning can be handled with the relative simplicity of a will, many people should use trusts as well. Revocable living trusts put assets into a separate entity you control but aren't subject to probate rules. Should you be one who uses this legal tool? Here are five less common indicators you may be.
1. Probate Costs Are High
Most estates must pass through the process of probate to confirm a will and any other estate documents. But probate isn't free, and your estate may end up paying thousands of dollars in court costs, legal fees, and professional services. This takes money from your heirs. So if you expect significant probate fees, avoid them by using a trust.
2. You Want Privacy
Unfortunately, probate cases are a matter of public record. Depending on how private you are as a person or what family issues might be raised by the contents of your will, you may not want everyone to have access to it. Trusts, on the other hand, avoid probate and do not have to publicize their terms.
3. Children Will Inherit Asset
Minors can't inherit assets directly, so someone must control and manage them for them. If your minor children's inheritances will be managed by a spouse, this could be relatively easy. However, if any other kids are involved or a spouse won't handle the assets, a trust can do the job for the children. And you can choose who manages the trust and its terms.
4. Your Heirs Need Immediate Access
Probate — even for somewhat simple estates — takes time to complete. During this period, your heirs may not have access to some or all of your assets. Do they need access to money, a house, or your pension? Do certain assets, like a business or art collection, need careful management or maintenance? If so, keep in mind that a trust has no delay in transferring assets.
5. You're Particular About Your Wishes
Instructions in a will are usually relatively simple — often addressing standard issues like who gets one's house or bank accounts. But if your estate contains anything with complex needs or you have very particular concerns about what happens to items, a trust is the best place to address these. You can set out terms as complex as you want and make arrangements for ongoing maintenance. Trusts are also good vehicles to oversee any long-term contingencies within your estate plan.
Does your estate planning fall into any of these nonstandard situations? If so, a trust could be the ideal solution to provide the best for everyone and protect your interests. Learn more contact a will and trust attorney.