Including a living trust in your estate plan has its benefits.
It is important to create an estate plan.
When done right, it protects everyone you love and everything you have.
DIY estate planning can have unintended, negative consequences.
This is especially true if your goals and needs would benefit from a trust.
According to a recent EIN Presswire recent article titled “Advantages of a Living Trust,” a trust is a sophisticated legal document.
While a last will and testament allows you to provide distribution directions for your assets through the probate court, a trust does not require the probate court to make distributions.
Unlike a testamentary trust, the living trust is created while you are alive.
The trust designates a person as a trustee to manage the assets held in the trust for the benefit of the trust beneficiaries.
Having no estate plan in place means your assets may be distributed by the laws of your state.
This can leave significant tax bills and other issues, depending on the size of your estate and your family circumstances.
At this time, the federal estate tax rate is 40 percent on any amount above the threshold.
Similarly, the expense of probate can be high.
Depending on the state and the complexity of your estate, dying without an estate plan could cost between 5 percent and 25 percent of the gross value of your estate.
Although a last will and testament and titling assets jointly may be sufficient for some, others would benefit from a living trust.
How might a living trust benefit you?
By avoiding probate, you can reduce the time it takes to settle your estate and the costs associated with this process.
Having a living trust can reduce stress for your family members.
Depending on the trust, you could reduce or eliminate taxes.
With a revocable living trust, you can make changes or cancel it whenever you choose.
A living trust is beneficial should you become incapacitated as it ensures these assets are continuously managed for your benefit without a loved one needing to seek a conservatorship.
A trust is confidential and protects the privacy of your affairs.
Distribution of your assets to heirs is timely and saves your loved ones future headaches in guessing your wishes.
If you are curious about whether a living trust would be best for your unique circumstances and goals, contact an experienced estate planning attorney to set up a consultation.
Reference: EIN Presswire (March 12, 2021) “Advantages of a Living Trust”