Estate planning isn’t just about writing a will. Among other things, it’s also about conserving your assets and minimizing the taxes on your estate.
Historically, trusts were something that only the ultra-wealthy bothered to create, but many people of relatively modest means can also benefit from using a trust to protect their assets.
What are the benefits of a trust?
Trusts largely exist outside of your regular estate, which makes a trust much less prone to challenges than a will. With the right trust, you can definitively control your wealth and make sure that your assets are distributed according to your plans.
You can also use a trust to protect yourself. Certain trusts can be used to protect you from money-grabs in your old age by con artists, debt collectors and government programs. They can even help you establish better options for your long-term care needs.
What are the most common trusts in use?
There are different types of trusts out there, but here are some that you may recognize:
- Living trusts, which convert to irrevocable trusts when their grantor dies
- Irrevocable trusts, which can minimize the value of your estate and put those assets firmly out of reach of creditors even in your lifetime
- Testamentary trusts, which are created for your heirs upon your death as part of your will
- Charitable remainder trusts which can help you avoid capital gains taxes
- Qualified domestic trusts, which can help if your spouse is a non-citizen
This small list of trust options is just for starters — exactly what will work best for your needs is something that is best discussed with an experienced attorney. If you’d like to learn more, please continue reviewing our website for additional information or contact us directly.