When you pass away, there are essentially three ways your estate can be handled:
The first is according to the laws of intestacy. These are state laws that dictate how assets should be distributed when the deceased dies without an estate plan.
The second way is through a Will. In this instance, you get to decide who gets what and the court supervises the ordeal in a process known as probate. Probate can be very costly and time-consuming for your loved ones. It also makes the details of your estate public record.
The third way to distribute your assets is through a Living Trust. Like a Will, you get to decide who gets what but with a Trust, you have some additional flexibility. In addition to dividing up your assets, you can also create incentives for your heirs to pursue lofty goals. A college education for example, might earn a bigger inheritance or you can set up the Trust to match whatever income your heirs bring in on their own.
The Trust is managed by a Trustee so this arrangement can continue for many years after your death.
In addition to the incentive abilities, you can also use the Trust to create income and support for future generations. In this case, the assets would remain part of the Trust and only the profits would be distributed to the heirs. That means that your grandchildren and your grandchildren’s grandchildren could potentially benefit from the Trust you create now.
A Living Trust also helps your heirs avoid probate and keeps everything private, so there’s no public record of the details of your estate.
If you’d like to learn more about setting up a Living Trust, contact us today.