Is a Trust Necessary?

Is a Trust Necessary?

A Trust is a Necessary Plan

Making an appointment to create your will is not usually a cause for celebration. It is a necessary task of life though and should be carried out. The alternative is that you may die, leaving your family in a bind. Since you do not wish to place an extra burden on those you love, you want to do the responsible thing and create a plan for them to follow after you die. An estate planning lawyer may suggest that you create other means of caring for your family that may benefit you now. Find out what function a trust can serve now and at the time when those you love are grieving your loss.

What Is a Trust?

For those who are not familiar with a trust, the entire prospect may seem unnecessary. For years, a trust was only thought to be applicable to wealthy people. However, a trust account can benefit even a minimal estate in many ways. Simply put, a trust is a financial tool used to transfer money or property from one individual to another. Some trusts allow you to withdraw the assets deposited, while others must remain unchanged until the terms of the trust are fulfilled. 

Who Can Create a Trust?

Trusts are not just for the wealthy. Anyone who has money or property can create one. The type of trust largely depends on what you want to use it for. Some use trusts to remove assets from their name for tax purposes. Others use them to temporarily transfer items from themselves for safekeeping from creditors and courts. Another reason to create a trust has to do with estate planning and passing items to others without going through court.

What Are the Benefits of a Trust?

Trusts provide various benefits to you as the grantor and those you name as the recipients or grantee. The most obvious has to do with federal and state tax shelters. Once you remove an asset from your portfolio and deposit it into a trust, it is no longer calculated as part of your wealth. It reduces taxes and estate value upon your death. Many people decide to use trust accounts as part of their estate to give loved one’s quick access to money. Trust accounts do not need to go through probate, so the grantee may access the funds upon presenting a death certificate to the holder of the trust.

If you still have questions about how a trust can be beneficial, consider contacting an estate planning lawyer in Roseville, CA from a law firm like Yee Law Group, PC for more details. Lawyers may also suggest other end-of-life documents you should consider integrating into a comprehensive estate plan.

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