Building an estate plan means outlining what will become of your assets, your business and all other important items when you pass away. Writing a will can accomplish many of the most important estate planning tasks, but having a trust ensures that your estate plan is truly complete.
There is a misconception that trusts only benefit the wealthy, but a revocable trust that you can manage throughout your life stands to benefit you regardless of your background. You can make the best decision regarding the formation of a trust by understanding which types of people benefit most from having a trust.
Parents
Having a will is important when you welcome a child to the family as it allows you to name an alternate guardian for your kids, but it is not the most ideal way to pass assets on to a minor. A living trust allows you to decide when in your child’s life they will receive your assets, such as when they reach adulthood.
Entrepreneurs
A trust is unique in its ability to pass on business assets to a chosen recipient. If you are an entrepreneur and possess a business of your own, it is crucial that you account for the future of that business as part of your estate plan.
Those wishing to avoid probate
Probate can be a painstaking process for the family that you leave behind when you pass. The sole purpose of probate, though, is to verify the validity of a will. By choosing to pass on your estate through a trust, you can spare your family much or all of the rigors of probate.
There is no one-size-fits-all solution to estate planning. Depending on your circumstances, it is important to consider whether you need a will, a trust or both when making your end-of-life plans.