Have you thought of using a trust to improve your estate plan?

On Behalf of | Jun 24, 2019 | Firm News |

There are many ways to go about estate planning. Some people start with a single document, like a last will, and then build on this as their assets and families become more complex. Others choose to jump in with both feet and create an estate plan that addresses everything from incapacitation to guardianship for their children all at one time.

Regardless of whether you are still in the process of slowly building an estate plan or have already completed the creation of an extensive and thorough plan, you may have found yourself thinking about whether a trust could be beneficial for you and the people you love in the future.

Trusts feature prominently in the estates of the wealthy and famous. Although many people associate trusts with seven-figure or larger estate plans, families with simpler assets can also benefit from the creation of a trust.

Trusts help you address unconventional situations

One of the reasons people turn to trusts is when they have to plan for unusual family issues. A trust offers more structure and control than a standard last will, which can be an ideal solution if, for example, there is a family member you want to provide for who has a serious disability.

In that scenario, the creation of a special needs trust could allow you to ensure that your heir will have assets and still qualify for critical state benefits like Medicaid. If you have a family member who seems to be a compulsive shopper or who struggles with addiction or gambling issues, you could create a spendthrift trust. This special form of trust structures the dispersal of the assets, preventing an heir from wasting the assets you leave behind or your unintentionally supporting a destructive habit.

Trusts can also allow for the easier transfer of assets if you share your life with people who do not have legal ties to you. By naming a beneficiary, you can ensure their immediate access to certain assets or even protect their right to remain in the home that you share together.

Trusts can eliminate the risk of probate and reduce tax liabilities

The use of a trust for your estate decreases the likelihood of your heirs needing to go through probate court. A trust also makes it more difficult for family members to challenge the contents of your estate plan simply because they are unhappy with their share of the assets.

If you believe that you need to worry about challenges, misuse of the funds you leave behind or even estate taxes in Illinois, then including one or more trust in your estate plan can be a great way to structure your legacy and provide for the people you love.