A Trust is an agreement between you and the Trustee for the Trustee to manage, invest, and distribute the property you put into the Trust. Some advantages a Trust can offer over a simple Will is the avoidance of probate administration, the confidentiality of your estate plan, the control of assets for minors, and the asset management during your lifetime.
You should always consult an estate planning attorney to determine if you really need a Trust. If your attorney advises you to use a Trust, then there are a variety of Trusts that might be appropriate for your estate plan.
Testamentary vs. Inter Vivos
A Testamentary Trust is created in your Will and becomes effective when you die. An Inter Vivos, or Living, Trust is created during your lifetime, funded during your lifetime, and used to manage assets before your death as well as after.
Revocable vs. Irrevocable
A Revocable Trust means that you keep the power to change the Trust. You can modify any part of the Trust at any time or even completely revoke it if you choose. Upon death, most Trusts become irrevocable, making your wishes permanent at that time.
An Irrevocable Trust generally means that you cannot change or revoke the Trust. (Amendments can be made by the Trustee, but it is more difficult than amending a Revocable Trust). In some cases, an Irrevocable Trust is preferred for tax or Medicaid planning purposes.
Self-Declaration of Trust vs. Third-Party Trustee
A self-declaration of Trust names you as the Trustee of your own Trust. You would have total control over your Trust assets, and you would name a successor Trustee who would step in at your death or incapacity to administer the Trust.
If you want the management of the Trust property to be in the hands of another individual or professional during your lifetime, you can name a third-party Trustee.
Our attorneys have over 35 years combined experience with estate planning. We can evaluate your unique goals and family dynamics to see if you would benefit from having a trust. Schedule an appointment online or call our office to begin the estate planning process.