What is a Trust?
The Short Explanation
A Trust is a distinct legal entity capable of holding and owning property for the benefit of its Beneficiaries.
What's the difference between a Will and a Trust?
-A Trust continues to exist for as long as you instruct (or property lasts).
-A Will exists for a limited time. It distributes property, upon your death and that's it.
-Property in a Trust, at the time of your death, avoids Probate.
-Conversely, property distributed through a Will is subject to Probate.
Why is Probate so Bad?
Probate is a court-controlled process with mandatory fees, based on the size of the estate. This process is both expensive and requires jumping through a lot of hoops. Probate can delay the distribution of your assets by months. In short, Probate can be a headache. For most people, it is simpler and less expensive to have a Trust formed.
Benefits of a Trust
Peace of Mind
Provide for the long term benefit/care of Beneficiaries--particularly relevant for those with minor children, special needs family members, or elderly dependents.
You retain the ability to modify or eliminate the trust.
You can move property in and out of the trust, during your lifetime.
You avoid the costs and headaches of Probate.
Control of Assets
You maintain greater control over the distribution of your assets, than with a Will.
For example: Distributions can occur at a future time or triggered by a future event (when your child reaches a certain age, graduates from college, gets married, etc.).
Speak to an Estate Planning Attorney today!
Want to know more? Check out our Estate Planning Glossary!