While there’s no harm in living in the moment, planning your finances ahead of time will be beneficial in the long run—especially estate planning. Do you know what will happen to your home, your investments? Probate can be a long and painful process if handled incorrectly, so that’s why (teamendrich) is here to help you keep your most important assets safe.
A living trust is one of the most popular ways to manage your estate both before and after you pass away. But what is a living trust? How does it differ from establishing a will? Here are some details about living trusts and how they can benefit your estate planning.
1. Trustee
For a living trust, you can appoint a specific person who will be responsible for managing your estate on your behalf. This is a great way to keep assets within the family by appointing a sole-decision maker.
2. Takes Affect Immediately
Unlike a will, a living trust takes affect while you are still alive. You can also choose to make your trust revocable and allow yourself the flexibility of making adjustments—or irrevocable by keeping decisions set in stone.
3. Asset Diversification
Living trusts help protect a wide expanse of assets. They can cover real estate, cars, boats, bank accounts, antiques, jewelry, artwork, family heirlooms, stamp or coin collections, stocks, bonds, mutual funds, and other securities.
4. Avoid Conservatorship
A living trust allows your trustee the ability to make decisions on your behalf. This can be very helpful if your health begins to decline quickly or unexpectedly.
5. Avoid Probate.
Probate is the legal process in which your estate is handled by the court. This can be a timely and costly affair, but a living trust grants your beneficiary the rights to distribute assets and avoid court.
6. Minor Specifications
If a minor is granted assets through a will, they will not have access to them until they are of age (18 or 21 depending on the state), and the inheritance will be managed by a legal guardian. However, with a living trust, you can provide special instructions dictating how a minor will receive these assets. Often, they are held for college funds or when they reach a certain age.
As you can see, there are many benefits to establishing a living trust to protect your assets. Crafting a will is beneficial if you are not married or don’t have a variety of assets, but adding a living trust to your plan offers greater flexibility and the opportunity to keep personal property within the family tree.
If you are considering setting up a living estate, (teamendrich) would be happy to connect you with a financial planner. Rules regarding living trusts can vary by state, and we have local connections who will guide you through the estate planning process.
We helped you obtain your home, now we want to make sure you keep it in the family! Prepare your living trust today!