There are a variety of different estate planning tools that are available to estate planners to help them develop an effective estate plan. A trust can be used as part of an estate plan to supplement a will or manage property during life. Trusts manage property by transferring the benefits and obligations of property to different recipients. Because trusts can help with property distribution, they are an excellent estate planning tool.
When creating a trust, the property owner transfers property to a trustee for it to be managed for the benefit of another party or the beneficiary. The trustee has a fiduciary relationship with the beneficiary and must act in the best interests of the beneficiary when administering the trust. There are two broad categories of trusts including testamentary trusts and living trusts. A testamentary trust transfers property at death and a living trust begins during the lifetime of the trust creator and can continue after death.
Living trusts may be revocable or irrevocable and may be beneficial when considering the probate process. There are important requirements for a valid trust, including that trust property must be transferred, so it is important to be familiar with the requirements when trust planning. A trust can work effectively with other estate planning tools such as a will, an advance healthcare directive and a power of attorney. Having an effective estate plan should not be stressful and is important for everyone.
An effective estate plan tailored to the needs and wishes of the estate planner can create tremendous peace of mind for the estate planner and family members alike. It is important for estate planners to be familiar with the estate planning tools available to them, such as trusts, and how to develop and effective estate plan for them and their family.
Source: Estate.findlaw.com, "Trusts: An Overview," Accessed April 12, 2017