If you haven’t stopped to consider how a trust may help you pass your legacy on, you could be making a critical estate planning mistake. Trusts are flexible and powerful tools that anyone with substantial assets can use to gain greater control over how they pass on their wealth. There are many types of trusts available, and each is designed to help achieve specific goals.
A trust can help you pass wealth efficiently and privately to your heirs. Perhaps the most powerful way to use a trust is to ensure that your heirs have timely access to your assets. When you transfer your assets to your beneficiaries through a Will, your estate is settled through state probate courts.
You can avoid probate and gain greater control over how your estate is settled by establishing and funding a revocable trust during your lifetime. Because the trust is revocable, it can be altered, amended or revoked during your lifetime. After your death, the trust acts as a Will substitute and enables the trustee to privately and quickly settle your estate without going through the probate process.
Some other important reasons to consider a trust:
- A trust can preserve assets for heirs and favorite charities
- A trust can reduce estate taxes for married couples
- A trust gives you control over how your assets are distributed, for example, specifically to fund education expenses
- A trust can keep assets in your family
- A trust can ultimately help you realize a vision for your estate, and in turn, your legacy