More Sophisticated Assets? A Trust May Be The Solution.
Individuals who want to care for their surviving loved ones must often venture past a traditional will. Fortunately, numerous types of trusts exist to ensure future financial security and protect assets from probate.
At Standard & Berry, PLLC, in Grand Rapids, our estate planning law firm services include setting up a trust or multiple trusts, depending on our clients’ needs. You can rely on our knowledgeable lawyers to help you decide which trusts are right for your assets, wishes and family. Give us a call today to learn more.
What Are The Benefits Of A Trust?
Trusts allow for more flexibility in distributing your assets to heirs and beneficiaries than a will typically offers. Depending on the type of trust(s) you choose, you can control the assets in the trust while you are still living or, through your instructions, after you pass. You may, for example, decide to place funds for your children in a trust with the specification that they do not get the money until they reach a certain age. In this way, you are still in control of the trust after you die.
Another benefit of a trust is that they can help avoid probate. Assets placed in a trust do not go through the probate process, which can be costly and time-consuming. We can explain this in greater detail when we meet with you.
There Is A Trust For Nearly Every Situation
Depending on your objectives, we can help you choose and establish a trust that will accomplish your goals. Two frequently used options are revocable and irrevocable trusts. While they both allow you to manage your assets, they each have features and benefits that work in different situations.
A revocable trust, also called a living trust, can be changed or even cancelled during your lifetime. The main benefit of this type of trust is that it allows the assets in the trust to avoid probate, saving your beneficiaries time and money as well as ensuring a smoother transition of your estate to your loved ones. It also keeps information regarding your estate private. In addition, it is used for managing your assets during your lifetime, for example in the event you become incapacitated. A revocable trust can be a good choice if you think your situation might change over time.
When you put your assets in an irrevocable trust, you don’t own them anymore, the trust does. An irrevocable trust generally cannot be modified or terminated once established. The assets placed in the trust are effectively removed from your estate and no longer under your control. Since you no longer own the assets, they are not subject to estate taxes. In addition, it protects your assets from creditors and any legal judgments against you. An irrevocable trust is also used to help individuals qualify for government programs like Medicaid.
The key differences between these two types of trusts are control and flexibility. With a revocable trust, you retain the ability to make changes. With an irrevocable trust, you give up control over your assets. This can provide tax advantages and asset protection, but you lose flexibility. Choosing the right type of trust for your needs is an important decision; we can help you make the choice that works for you.
There are many other kinds of trusts as well, including:
- Special needs trusts
- Pet trusts
- Charitable giving trusts
- Life insurance trusts
- Spendthrift trusts
- Firearms or gun trusts
After we discuss your assets and goals for them, we can recommend a trust or several trusts to meet your needs.
You Can Count On Our Knowledge Of Trusts
It may seem a little confusing now, but a trust management lawyer will explain how trusts work and which ones may be best under the circumstances. Please call our firm today at 616-622-3064 or send us a message online.