You don’t have to be a CEO or multimillionaire to benefit from a trust. If you have specific wishes on how and when you want your estate to be distributed among your heirs, then a trust could be appropriate. You might also be interested in setting up a trust if you’d like to avoid the time-consuming, usually expensive and always public process of probate. Some types of trusts may also help protect your estate from lawsuits and creditors. Currently, only a small percentage of Americans are subject to estate taxes, but estate-tax laws change, so tax laws might be subject to change as well.
The Bryan County (GA) News published an article, “What should you know about trusts,” that gives some good advice. The first tip is if you think a trust might be a good fit, you need to work with an experienced estate-planning attorney. Trusts are designed to be highly effective estate-planning vehicles, but they also can be extremely complex. Not all attorneys know enough about them to set them up and administer them properly. Seek a qualified estate planning attorney.
Selecting a trustee is an important decision, as he or she is legally bound to manage the trust’s assets for your beneficiaries. Before you select your oldest daughter or another family member, ask these questions:
- Does he or she have the experience and knowledge to manage your financial affairs in a competent manner?
- If she must make a decision that may impact family members, will she act in a fair and unbiased manner?
- Will naming a family member as trustee create issues for the family?
- Does your prospective trustee have the time to manage your trust?
- Does she want this major responsibility?
- Do you have another person in mind to serve as trustee if the trustee you selected can’t do it?
Give considerable thought into who you ask to take on these roles. You can also ask a financial institution to serve as trustee, but be sure to inquire about costs and the services they provide.
Once you start these plans, it’s a good idea talk to your family about your wishes and other beneficiaries of your estate. People get hurt feelings if they have no idea what to expect. Get your loved ones on board with your estate plan so that you’ll feel even more comfortable in putting your plans in place.
You can learn more about this topic as well as other strategies on our website under the tab entitled: estate planning in Virginia. Be sure you also sign up for our complimentary e-newsletter so that you may be informed of all the latest issues that could affect you, your loved ones and your estate planning. However, proper estate planning is not a do-it-yourself project. Why not call us for a complimentary consultation at 757-259-0707.
Reference: Bryan County (GA) News (August 2, 2015) “What should you know about trusts”