A trust can provide many benefits for the settlor and the beneficiaries. For example, a trust is not supervised by a court and generally provides more privacy for a settlor because there are no public records where some outside person will be able to determine who the beneficiaries are. A trust provides for centralized management of assets. Properly funded, a trust can avoid the probate process and may be a less expensive way to transfer assets. A trust is an excellent vehicle to plan for various contingencies such as if a primary beneficiary dies or become disabled. A trust can be used to minimize estate taxes or minimize income taxes among several beneficiaries. I usually set up one joint trust between a husband and wife so a husband and wife do not have to actually split assets when setting up an estate plan. Generally the larger the estate, the more likely the settlor(s) will benefit from a trust.
However, a trust is not for everyone. For example many times individuals with a modest or small estate consisting primarily of their homestead property do not need a trust. When a settlor dies there are still duties for the trustee to perform, and trust administration can be a complicated a probating a large estate. I know several one attorney in town to tries to convince every individual to set up a complicated dynasty trust no matter what the size of the individual's estate. If you do not understand that a 50 page trust says or why you need it, then you should never set one up. Contact attorney Matthew Linde today for more information.