Trusts are established to provide legal protection for the trustor’s assets, to make sure those assets are distributed according to the wishes of the trustor, and to save time, reduce paperwork and, in some cases, avoid or reduce inheritance or estate taxes.

Who should have Trusts?

Here’s a good rule of thumb: If you have a net worth of at least $100,000 and have a substantial amount of assets in real estate, or have very specific instructions on how and when you want your estate to be distributed among your heirs after you die, then a trust could be for you.

Why would someone create a trust?

To manage and control spending and investments to protect beneficiaries from poor judgment and waste; To avoid court-supervised probate of trust assets and be private; To protect trust assets from the beneficiaries’ creditors; To reduce income taxes or shelter assets from estate and transfer taxes.

Why are there so many different types of trusts?

There are many different types of trusts. Some become effective as soon as you set them up, and others are only enforceable after you die. Established correctly, and a trust transfers your assets to your heirs easily, keeps your property away from the probate process, and can reduce or eliminate taxation on the assets you list in the trust.

What are some of the benefits of a trust?

While there are many different kinds of trusts with unique features and benefits for each, some of the common benefits of a trust include reduced estate taxes, allocation of assets into the desired hands, avoiding court fees and probate, protection from creditors, or even protection of assets…

How is a trust different from a will?

Since trusts usually avoid probate, your beneficiaries may gain access to these assets more quickly than they might to assets that are transferred using a will. Additionally, if it is an irrevocable trust, it may not be considered part of the taxable estate, so fewer taxes may be due upon your death.

What can a trust be used for in estate planning?

This type of survivorship life insurance can be used for estate tax planning purposes in large estates, however, survivorship life insurance held in an irrevocable trust can have serious negative consequences. An asset protection trust is a type of trust that is designed to protect a person’s assets from claims of future creditors.