Trusts Attorney in Boca Raton, Florida
When people hear the term “estate planning,” visions of gated communities and luxury automobiles may come to mind, leaving them thinking that it’s not something they need to be concerned about.
Wrong. Everybody accumulates assets and items of personal value throughout their lifetime of working. Estate planning will help ensure that those assets go to the loved ones you wish to receive them.
This is one of the many purposes of estate planning — to put in place protections for your loved ones — but estate planning needn’t (and shouldn’t) stop there. You should also plan for your life in the future and create contingencies for any potential eventuality.
Pretty much everybody knows what a will is, even if only from TV and movie dramas where wills are read and gasps arise from the audience from those who feel cheated or left out. A last will and testament is indeed a basic building block of estate planning, but a will can create legal headaches for your survivors when they find themselves having to navigate probate court.
A better option is a trust, which avoids probate court and if used correctly, can better protect your assets. In fact, you can create various types of trusts for various situations, but the living trust is the better alternative, or supplement, to a will.
If you live in Boca Raton, Florida, or in Delray Beach or Deerfield Beach, contact Peter J. Snyder P.A. to begin your estate planning process, or to review what you already have in place with an eye to updating and augmenting everything. Attorney Peter J. Snyder has more than three decades of experience in estate planning and will provide you with a personalized and detailed plan to achieve peace of mind for you and yours.
Wills vs. Trusts
A will is a basic estate planning instrument that can designate the distribution of your estate after you’re gone — basically “who gets what.” The hitch is that administering the will can be cumbersome because it must go through probate court proceedings, which can take months or even more than a year. It can also run up costs if creditors or disgruntled would-be beneficiaries raise challenges.
A living trust also allows you to designate who gets what, but it has a few major advantages over a will. First, as mentioned, there is no need for probate. Your assets have already been transferred to the trust, so there is no need for court supervision.
Second, a living trust allows you to set up a successor trustee who can take charge of your affairs should you become incapacitated. Third, since a trust doesn’t go through probate, it does not become a public record. It all takes place privately.
Essentials of a Trust
To further explain how a living trust works, you as the grantor of the trust will generally name yourself as the trustee, so you can continue to manage everything while you’re alive. Should you become incapacitated, the successor trustee you name in the document will take over the management of your finances and assets. When you pass away, the successor trustee will assume the same responsibilities as a personal representative in a will, but without a court watching over their every move.
Even if you set up a living trust, you should still have a will for a couple of reasons. If you need to name a guardian for your minor children, you cannot do that in a trust. Also, if you acquire assets and forget to move them into the trust, a will can cover their administration and distribution.
You could also set up what is called a pour-over will, which names your trust as your only beneficiary, so your overlooked assets will pour seamlessly into your trust.
Types of Trusts
There are various types of trusts, but the two major ones are the living trust, also called a “revocable trust” since it can be modified or canceled at any time, and the irrevocable trust. In an irrevocable trust, you transfer all your assets to the trust to be managed by a trustee other than yourself. The advantage of an irrevocable trust is that it can help shield assets from creditors and lawsuits.
Other types of trusts include what is called the spendthrift trust. This is an instrument that prevents the beneficiary from wasting through their inheritance in a spendthrift fashion. The trustee will distribute the assets to the beneficiary only upon proof of need, or according to pre-established standards and conditions.
You can also establish a charitable trust so your assets go to a cause you believe in. A charitable trust can be a vehicle for creating your personal legacy.
A special needs trust can be tailored to care for a loved one who needs specialized care because of a mental or physical condition. It can be used to protect assets and help qualify the recipient for government benefits such as Medicaid, which may have income and asset threshold tests.
Trusts Attorney Serving Boca Raton, Florida
A trust can avoid probate proceedings, as well as the emotional and financial costs of the court process. If you’d like to learn more about trusts and how they can help provide peace of mind about the future and you are located in Boca Raton, Florida, or in Delray Beach or Deerfield Beach, contact Peter J. Snyder, P.A. today.