Trusts are a versatile and powerful estate planning tool, but they are a tool that you should often use with the help of an experienced attorney. Trusts do many different things and you need to ensure that you select the correct type of trust in order to accomplish your desired purposes. It is also vital that you ensure you have followed all formalities for creating your trust document so your trust will be a valid and enforceable one.
Unsworth LaPlante, PLLC can help you with the trust creation process and can assist you in the creation of a trust that provides the protections you need for your assets and your loved ones. You should give us a call today so you can get personalized advice with the process of creating your trust. You can also review the answers to frequently asked questions below to find out more about the trust creation process and about what trusts can potentially do for you.
Q. Are wills or trusts better for securing your legacy?
When deciding between wills and trusts for securing your legacy, it is important to realize that trusts are much more versatile than a will and that trusts give you much more control over assets. When you create a last will and testament, you dictate who inherits but you have limited or no ability to protect the assets.
Estate tax is a risk and you will not be able to protect heirs or beneficiaries from financial loss if you simply leave them money in a will. Trusts can give you much more control over assets after you are gone, and- depending upon the kind of trust that you create- trusts can also protect your assets during your lifetime as well. A will obviously cannot do that.
Q. What are the limits of revocable trusts?
There are different kinds of trusts that could be created. A revocable trust is one type of trust. A revocable trust gives you flexibility over trust assets during the course of your life while allowing you to still arrange the transfer of those assets outside of the probate process. However, there are limits to a revocable trust.
First, just because the assets are able to be transferred outside of the formal probate process does not mean the assets are not counted as part of your taxable estate for determining if you’ll owe estate taxes or not. Second, the assets held in an revocable trust are generally not protected from claims by creditors and are not going to be protected in case you need nursing home care and want Medicaid to pay for the costs.
Q. Why do you need a pet trust?
Trusts are often created in order to provide protection for loved ones, such as a spendthrift trust which ensures that heirs do not squander their inheritance. When you are creating a trust to protect those who matter in your life, don’t forget your pets. A pet trust can help you to ensure that there is money available to provide for the care of your animals after you are gone. Pets can be very expensive and you do not want your animals to be deprived of the care that they may need simply because there is not enough money.
While you could simply leave money in your will for the care of pets, this would not necessarily ensure that the money was used for its intended purpose. Animals, of course, cannot directly inherit or manage money, so leaving money in a will is not the best way to ensure that these animals are cared for.
A better option is to create a trust, name a trustee who will have a fiduciary duty to use the money to provide care for a pet, and name the pet as the beneficiary. You can provide specific instructions for the trustee regarding exactly how the trust assets should be used to care for the pet and regarding what should be done with any money that is left over at the end of the pet’s life. It is common, for example, for remaining funds in the trust to be donated to some type of animal rescue group or animal welfare group.
Q. Are DIY living trusts a good idea?
Creating a DIY living trust is generally not a good idea. In fact, creating any kind of DIY trust is usually not advisable. When you create a do-it-yourself trust, you miss out on the opportunity to get legal advice. Your attorney may have been able to help you to find a better estate planning tool than the trust you are trying to create, which would have accomplished your goals in a more efficient and effective way.
An attorney can also help to make certain that the trust will actually provide the benefits you are hoping for, and will assist you in making certain that you fund the trust properly so all of the assets you are trying to protect can be kept safe. Finally, an experienced attorney can assist with the selection of a trustee and with the creation of a legally valid trust document so you will have the peace of mind of knowing you have created a valid trust with the right trustee in control.
Unsworth LaPlante, PLLC has helped many clients to make both revocable trusts and irrevocable trusts and we can guide you through the process of making the right type of trust in the right way to meet your needs. To find out more about the assistance our legal team can offer to you with the trust creation process, join us for a free seminar.
You can also give us a call at (802) 879-7133 or contact us online to for personalized assistance with all aspects of the trust creation process and all aspects of the estate planning process. Call now to get started on your personalized plan so you can protect your family, your assets, and your secure financial future.