As you age, it only makes sense to pay close attention to your estate plan.
Do you like the decisions you made in the past? Do you need to alter your plan in some way? Is there something you could modify to improve your estate plan, both for you and your loved ones?
Depending on your situation, it may make sense to consider the many types of trusts available. Even if you never move forward with setting up a trust, you'll at least know more about your options.
Here are some of the primary reasons to consider a trust, especially as you work towards retirement and begin to think more about what will happen to your estate in the future:
- A trust allows you to put conditions on when and how your money and assets are distributed after you pass on.
- With the right type of trust, you can help reduce both gift taxes and estate taxes.
- The opportunity to avoid probate. With a trust, unlike a will, your assets do not go through probate. As a result, the assets are distributed in a more timely, cost effective and private manner.
- Protection of your assets from both lawsuits and creditors.
- The ability to name a trustee, with this person responsible for managing your trust after you pass on.
Why do so many people ignore trusts?
As long as you make estate planning decisions that give you confidence and protect your assets, you can be happy with what the future will bring (even after you are gone).
To ensure that you're on the right track, you should take the time to learn more about each type of trust. Many people ignore this estate planning tool because:
- They don't know which type is best for them.
- They think that a will is more than enough.
- They are worried that it will cost too much money to create a trust.
Although there are challenges associated with creating a trust, such as moving the appropriate assets into the trust, the benefits far outweigh these. Furthermore, since you have the ability to personally work with an estate planning attorney, you don't have to concern yourself with making mistakes.
There is no guarantee that a trust will improve your estate plan, but you owe it to yourself and your family to at least consider this strategy.