Family is everything, and as we grow older, we often start thinking about how we can best provide for our loved ones after we’re gone.
This is where Family Trust comes in. A Family Trust is a crucial tool in safeguarding your legacy.
In this article, we will explore what Family Trusts are, why they are important, the different types of Family Trusts, and how to get started.
What is a Family Trust?
A Family Trust is a legal arrangement that allows you to transfer your assets into a trust, which is managed by a trustee, on behalf of your beneficiaries.
A trust is a separate legal entity that can own property, invest assets, and distribute income to beneficiaries. The trustee is responsible for managing the trust and making distributions to the beneficiaries according to the terms of the trust.
Why is Family Trust important?
There are several reasons why you might want to consider setting up a Family Trust.
The ability to transfer assets to loved ones without going through the probate process is one of the main advantages of a family trust.
Probate is the legal procedure that takes place after someone passes away; it can be lengthy, pricey, and public. Your assets will be divided by your preferences if you transfer your assets to a Family Trust to avoid probate.
A Family Trust has the additional benefit of being able to support your loved ones long after you are gone. For instance, you could wish to establish a trust that covers your kids’ schooling, medical care, and other costs until they reach a specific age.
One of the primary benefits of a Family Trust is that it allows you to transfer your assets to your loved ones without going through probate.
Probate is the legal process that occurs after someone passes away, and it can be lengthy, expensive, and public. By transferring your assets to a Family Trust, you can avoid probate and ensure that your assets are distributed according to your wishes.
Another reason to consider a Family Trust is that it can provide for your loved ones long after you have passed away. For example, you may want to create a trust that provides for your children’s education, healthcare, and other expenses until they reach a certain age. You can also create a trust that provides for your spouse’s needs if you pass away before they do.
Having a family trust can also protect your assets from creditors. If you are sued or go through bankruptcy, your assets in a Family Trust may be protected from seizure. This can help to safeguard your legacy and ensure that it is passed down to your loved ones.
Different Types of Family Trust Funds
Here are some of the most common types of Family Trusts:
Revocable Trusts: A revocable trust is a trust that can be changed or revoked at any time during your lifetime. This type of trust is often used as a basic estate planning tool to avoid probate and simplify the transfer of assets to your beneficiaries.
Irrevocable Trusts: An irrevocable trust is a trust that cannot be changed or revoked once it has been created. This type of trust is often used for asset protection, estate tax planning, and Medicaid planning.
Charitable Trusts: A charitable trust is a trust that provides for a charity or other nonprofit organization. This type of trust can provide significant tax benefits, as charitable donations are often tax-deductible.
Special Needs Trusts: A special needs trust is a trust that provides for the needs of a disabled beneficiary without disqualifying them from government benefits like Medicaid or Supplemental Security Income (SSI)
How to Get Started
Setting up a Family Trust can be a complex and time-consuming process, and it is important to have expert guidance to ensure that your trust is set up correctly and meets your needs. An experienced estate planning attorney can help you to create a Family Trust that is tailored to your specific situation and goals.
When choosing an estate planning attorney, it is important to look for someone who has experience in setting up Family Trusts and who has a deep understanding of estate planning and tax law. You should also look for someone responsive, and communicative, and takes the time to explain complex legal concepts in a way that is easy to understand.
Let us help you safeguard your family’s future today with a personalized and well-crafted Family Trust. At Kreitler Financial, we are proud to work with clients who have achieved a great level of success and who are committed to long-term relationships. Our clients have investable wealth from $2MM to more than $100MM and value our expertise and holistic approach to wealth management.
Contact us now to schedule a consultation!