TOP 10 REASONS YOU NEED A LIVING TRUST
Now, you might say: “I don’t need a trust. I don’t have a large estate. I don’t need fancy planning. It’s too expensive anyway. And complicated. So I just don’t need a trust!”
And so you ask: “Why would I want to have a trust?”
I’m going to describe in a few simple words why you will benefit from a trust.
First, let me explain what a trust is. A trust is a written document that allows you to legally transfer your real property and your personal property to your family, heirs, and loved ones, upon your death. And all without requiring that burdensome and expensive court process called probate.
Here’s How a Trust Works
You might think of your trust the same as forming your own company. You (and your spouse, if married) are the only employees and managers of the company. All of your assets are now owned by your company, not by you individually. You are still in full control. Your company instructions say that in the event of your death or incapacity, you have named an alternate person to “run the company.” That person is the successor trustee of your trust.
Since all your possessions are now titled in the company’s name, (which is really the name of your trust), there is nothing in your name which would require probate. Since probate is the legal proceeding to change the owner of your assets upon your death, it won’t be needed because you own no assets. All is in your trust name.
Top 10 Big Reasons You Need a Trust:
1. It saves you money because your trust avoids probate. Instead of paying thousands of dollars in probate costs, fees, and attorney charges, the bulk of your estate will be distributed to your heirs upon your death. A BIG savings.
2. You keep control.Your trust document contains your instructions for managing your assets, and the use of your funds in the event of your death or incapacity. Even when you are unable to handle your own affairs, your trust will ensure they are handled the way you want. And while you are able, you still have full control to buy, use, spend, or even give away your property as you determine. You can sell property, change your beneficiaries, or your trustee, or even revoke the trust if you should decide to do so.
3. You save a lot of time for your heirs. It takes less time to settle your estate if it doesn’t go through probate. Instead of taking months or even years, with a trust your estate can be settled in just a few weeks of your death. There are no court delays or judicial interferences. That means less cost, less aggravation, and less time delay.
4. Your privacy is maintained. A living trust is private. If you become incapacitated, it will remain a private family affair. Upon your death, no announcements need be placed in the paper to invite creditors to file claims, to contest your will, or to notify disgruntled relatives. Your beneficiaries won’t be made public if you have a trust. On the other hand, if you have a will, everything is public record . . . available to the prying eyes of predators and creditors.
5. It is less expensive for you and for your beneficiaries. Don’t forget the costs of probate are a part of the cost of settling your estate with a will. A trust is initially more expensive than a will. But because you eliminate probate when you create a trust, the total costs of settling your estate are far less. Be sure to use only a competent estate planning attorney and not only will there be a cost savings, but the ease of creating your trust will surprise you.
6. No special government forms are needed. With a revocable living trust you do not need a separate tax identification number. You do not file a separate tax return. The trust is tax neutral. You still report all your income on your personal tax return. Your social security number is your trust tax ID number. And you do not need to file any report, agreement, or notice with any government agency.
7. Low maintenance. Once your trust is set up, there will be few changes. You will amend your trust only when you wish to change your beneficiaries or successor trustee, or other details. Occasionally the government will pass a law which affects your trust, however this is rare. An amendment to your trust is generally a simple process.
8. You can make special gifts to your loved ones from your trust. If you want to make certain awards, rewards or donations to chosen individuals or organizations you may do so. With a trust this is easy. The trust makes reference to a special list of such gifts. On this list you identify who you chose to receive certain tangible personal items, such as jewelry, furniture, or other heirlooms. This list is kept with and referred to in your trust document. You may change this list from time to time without amending your whole trust agreement.
9. You will eliminate or at least reduce estate tax. With special planning built into your trust agreement, you may reduce or in some cases even eliminate any estate taxes which would be charged upon your death.
10. You have an effective Pre-Nuptial Plan without a pre-nuptial agreement. Any property that you place in your trust before you marry is and remains the property of that trust. It stays separate from property accumulated during your marriage. Just be careful not to commingle assets with those acquired by both spouses during a marriage.
BONUS: Here’s an added bonus you get when you set up your trust. In the event of your incapacity, your Successor Trustee may immediately take control of your estate for your benefit. No guardianship hearings need be held. No court conservatorship will be required. Conservatorship is like probate for the living. . . it’s no fun and you don’t want any part of it. There are many advantages to a living trust. If you haven’t considered one before reading this report, now is a good time to think about it. But don’t just think about it! Make a decision to create your trust now. Don’t wait until it’s too late. There is a high risk for waiting. Accidents and unexpected emergencies occur without warning. What if you become disabled or incapacitated? Or what if you should die? Be prepared for any contingencies … put your living trust in place … before it’s too late.
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Clint W. Smith, J.D., is an expert Estate Planning Attorney. For more than 25 years Clint has been helping people like you, personally as well as in their small businesses, protect their assets and prepare to transfer them to their heirs with the least aggravation and loss of value. To learn more how a Living Trust can benefit you and to sign up for his newsletter “Insider Secrets to Wealth Preservation” go to: http://www.EstatePlanningDr.com