There are many trusts to choose from when you are going through the process of planning your estate. Learning about all of them can feel time-consuming and overwhelming. However, it is important to do so in order to make the best decision for your estate and beneficiaries.
A testamentary trust is unique because it is not in existence during the lifetime of the estate planner. Instead, it comes into effect at the end of the estate planner’s lifetime.
What are the advantages of a testamentary trust?
A living trust is known as an irrevocable trust because once it is created, it cannot be changed. The advantage of a testamentary trust is the fact that it remains revocable, and therefore, subject to change at the creator’s will until the creator of the trust passes away. This allows you, as the estate planner, a certain amount of flexibility and control.
Is it costly to create a testamentary trust?
Creating a testamentary trust in itself is not expensive, relatively speaking. However, a testamentary trust needs to go through the probate process, and these fees can be quite costly to the estate.
Can life insurance proceeds be included in the trust?
One of the key benefits of a testamentary trust is the fact that life insurance proceeds can be paid into the trust. This is made possible when the trust is listed as the beneficiary on the life insurance policy.
If you are considering creating a testamentary trust in the state of Massachusetts, it is important that you equip yourself with the necessary information. An experienced attorney can provide valuable advice and guidance.