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Tag: Trust

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Basic Estate Planning Mistakes to Avoid


Bigstock-Extended-Family-Relaxing-On-So-13907567[1]If you would like to make sure that your estate goes to the people you want it to go to, then it is important to avoid making some basic estate planning mistakes.

It is impossible to avoid making mistakes in every aspect of your life. No one can always be perfect at everything. Estate planning is no different.

CNBC recently wrote about some of the common estate planning mistakes we can avoid in “Don’t drop the ball when planning your estate.”

They include:

  • Many people do not make a will. Without a will, then you cannot decide who gets your property. Every estate plan should have a will of some sort.
  • After making a will some people never update it. This is a mistake as a will should be changed whenever there is a significant change in circumstances to make sure the will reflects the new circumstances.
  • It is a mistake to not consider how your heirs will handle their inheritances and whether they are capable of being responsible with anything you leave them.
  • It is a mistake to not consider getting a trust, especially if your heirs have the potential to be irresponsible. A trustee can oversee the inheritance and make sure it is used appropriately.
  • Finally, it is a mistake to not think carefully about who to appoint as an executor of a will or as a trustee.

If you realize that you need a will or trust, call Profit Law Firm for a consultation.

Reference: CNBC (Sept. 13, 2016) “Don’t drop the ball when planning your estate.”

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A Trust Is Worth It


Bigstock-Vintage-brass-telescope-on-ant-44347372[1]Setting up a trust can be time-consuming and there is no doubt that even the simplest trust takes some work to create. However, taking the time and making the effort is worth it.

A common question people have when they start to think about estate planning is whether it is worth the effort to create a trust. Just drafting a will is a lot simpler in most cases for the person doing the plan. Creating the trust requires funding the trust, which means that you have to transfer your assets into the trust.

If you just get a will, then you do not have to bother with any of that. However, if you are going to go to the effort of getting an estate plan, then you might as well make the effort of getting the best estate plan you can.

Taking the time to create a trust is almost always worth it as the Green Bay Press-Gazette explains in “Setting up a trust is worth the work.”

The two biggest advantages to a trust are that the trust makes it easier for you to control how your assets are used and distributed after you pass away. Moreover, a trust is much easier for your heirs to deal with after you pass away versus going through probate to sort out a will.

There are other advantages as well, such as keeping the details of your estate unavailable to the general public.

Even though a trust does take more effort to create than a will, the truth is that most of that effort can and should be done by an estate planning attorney. The attorney can make sure everything is set up properly and can normally assist in transferring assets into the trust.  If you want to see how a trust might benefit you and your heirs contact Profit Law Firm.

In the end, getting a trust does not have to be that much more work for you.

Reference: Green Bay Press-Gazette (Aug. 29, 2016) “Setting up a trust is worth the work”

 

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Trust Basics

Bigstock-Financial-consultant-presents--14508974[2]When looking for estate planning advice people often see suggestions that they should create a trust. That is only helpful if they know what a trust is.

The Internet is full of estate planning advice most of which tends to suggest that people should get a trust. The benefits of doing so are often explained in detail.

Nevertheless, before people can get to the point where they can adequately assess the benefits of a trust for their own circumstances, they first need to know what a trust actually is.

That is not explained as often.

While it might seem obvious to some people, other people do not really know what a trust is. Recently, the Motley Fool discussed some of the basics in “What Is a Trust Fund?”

A classic trust is very simple. Person A (the grantor) creates a legal entity and gives it assets that are managed by Person B (the trustee) for the benefit of Person C (the beneficiary). Those are the three basic elements of every trust.

They can be complicated. For example, a trust can have multiple Persons A, B or C. In some types of trusts a single individual can play more than one role. Despite those complications, the basic structure of the trust does not change.

While there are many different types of trusts, including family, revocable, irrevocable, and many more, they all follow the same pattern. Trusts are a way to pass assets on to beneficiaries in a way through which those assets are independently managed by a trustee.

If you would like to learn more about trusts and whether one is right for you, contact an estate planning attorney.

Reference: Motley Fool (Aug. 28, 2016) “What Is a Trust Fund?”

 

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Is a Trust Appropriate?

Bigstock-Financial-consultant-presents--14508974[1]Wills and trusts are the two pillars of estate planning and determining how assets will be passed on to future generations. You need to know whether or not you need one, the other or both.

The two main ways that people pass their assets to their heirs are through a will and through a trust. They both serve the same basic function of transferring assets—but in very different ways. Wills normally go though probate court while trusts are handled privately. It is important to know if you need one or the other. For wills, that is a simple question to answer. Everyone needs a will. Even if you have a trust, you will need a will to deal with any assets inadvertently or intentionally left out of the trust. Trusts are more complicated. Recently, the Brainerd Dispatch discussed some considerations about whether a trust is necessary in the article, “Commentary: When does it make sense to add a trust to your estate plan?” Things to consider include:

  • Privacy – Wills are normally made available to the public, but most trusts can be kept private. If you do not want other people to know the details of your estate, then a trust is what you need.
  • Property in Multiple States – If you have property in more than one state, then a trust might be best. Otherwise, your estate may have to be probated in each state to deal with the property.
  • Control – Trusts can offer you much greater control over how your heirs will inherit your assets.
  • Charity – Trusts are generally a better tool for giving part of your estate to charity. If set up properly, you can even get a tax break now, keep control of your assets and have the assets go to charity after you pass away.

For help determining what is necessary for your situation, consult an estate planning attorney.  For  consultation on your situation contact Profit Law Firm, PLLC.

Reference: Brainerd Dispatch (July 23, 2016) “Commentary: When does it make sense to add a trust to your estate plan?”