5 Takeaways That I Learned About Trusts
Discussing how to ensure a well cared for and intact family after you are gone, may not be a fun topic. It is essential to consider a living trust. The document lists your wishes regarding your assets, once you die. Although the document has some similarities to a will, it is slightly different with several benefits. Before a will becomes effective, the court has to be involved in a series of processes (probate) to distribute the assets. Probate is both time consuming and expensive. However, for a living trust, you appoint a successor trustee who distributes your assets after your death without involving the court. It is thus cheap and time-saving. A will may include court fee, attorney bill and executor fee which may be close or above 5% of the assets.
In addition, a living trust ensures the protection of your privacy and that of your family. Obviously, during the probate, the will becomes a part of public records. At no point does the living trust become a public record since it requires no probate; hence no search can revile the distribution of the assets. By appointing successor trustee, you can keep off the court in your asset affairs even in case of illness or related issues. The document also avails peace of mind to you. With this legal document with a clear outline of your wishes, you are sure that the family is well cared for. The beneficiaries can also attain peace of mind, aware that you have already taken care of them.
Settling a living trust can be lengthy, but first, ensure you have your preferred successor trustee. Make your living trust checklist so that you do not leave out or miss essential requirements. There are essential requirements in the living trust checklist you need to include. Start by preparing an inventory of the assets and include liabilities. Be sure, also, that you order five or more death certificates from the funeral home. It is also critical to outline all expenses in the living trust checklist. Further, ensure that each of the beneficiaries has a statutory notice.
Additionally, ensure that in your living trust checklist includes the filing of the estate tax returns. Next, ensure you make both preliminary and final distributions to all who are in your list of beneficiaries. Eventually, ensure that all the beneficiaries sign both the receipt as well as waiver of any further accounting. Therefore, before when setting the living trust, ensure that the living trust checklist has all these vital requirements.