If you are a parent of an adult child who has proven to be inept at handling money, it can make your estate planning efforts especially challenging.
An inter vivos trust is the formal term for what is commonly known as a living trust. A living trust means that you are able to place your assets in this trust, modify the contents of the trust, and if desired, revoke the trust during your lifetime.
When planning your estate, it is likely that you have considered creating a trust to hold your assets in your lifetime and beyond. All of the different types of trusts can be very confusing, especially to a person who is just starting to plan his or her estate. Therefore, it is important that a person planning his or her estate takes the time to learn about the different types of trusts that are available, and what benefits they can provide.
Trusts should be an important part of planning anyone's estate. There are many benefits in using trusts as part of your estate plan. For example, trusts can make it possible for you to avoid the probate process, which can be both lengthy and expensive for your beneficiaries.
Protecting your assets should never be an afterthought of wealth acquisition. The way that you manage your assets and investments can be one of the key indicators of long-term wealth and the future of a legacy.
Navigating the world of wills and the many different types of trusts can be overwhelming at first. But the more that you read about the different options available to you, the more you will begin to understand that the many different options will actually work in your favor, offering you flexibility, and something for every financial and personal need.
The terms of a good trust are just as much about protecting your assets as they are about distributing them. Of course you want your children and grandchildren to be able to enjoy your hard-earned estate, but do you really want your 18-year-old grandchild to blow it all on a spring break getaway or on a bad investment that they will regret in years to come? Creating the terms of your trust is a way to instill some wisdom into your dependents, something that they will surely be thankful for in years to come.
As you watch your children grow and perhaps also have careers, partners and children of their own, it will likely become increasingly important to you that you take care of the wealth that you've acquired during your lifetime, so that you can pass it on to the next generation. One great way to do this is through a living trust, which is a more flexible alternative to a will.
It can be in your best interest to reduce the amount of taxes incurred by your estate. After all, who wouldn't want to pass as much of their estate along to their loved ones as possible?
When parents and grandparents devise estate plans in order to leave their beneficiaries legacies, sometimes their estate planning attorneys may recommend establishing something called a spendthrift trust for one or more heirs. But what are these trusts, and for whom are they ideal?