Are you drafting an estate plan? Have you considered adding a trust? A trust is a legal document that allows you to protect your assets from probate, disputes, estate taxes and debt collectors. When you draft a trust, you put your assets in the hands of a trustee (which may or may not be you, depending on the type of trust you choose). The trustee is responsible for managing your assets according to the terms of the trust.
There are many different kinds of trusts, including the following.
1. Revocable trust
The most common kind of trust is called a revocable trust. You can alter the terms or contents of a revocable trust at any time. This allows you to make changes to a trust later in life. After you pass away, the revocable trust becomes irrevocable and cannot be altered, protecting the contents from disputes.
2. Special needs trust
Do you have a beneficiary who benefits from government-supplemented income or health insurance? An inheritance could prevent your beneficiary from keeping their benefits. However, you can make a special needs trust to protect your beneficiary’s benefits while giving them an inheritance.
3. Generation-skipping trust
Have you considered what your estate can do for future generations? You can set up a generation-skipping trust to financially support grandchildren and great-grandchildren.
Are you ready to add a trust to your estate plan? You can reach out for professional legal guidance to learn how to draft a trust at any time.