Fed Week’s recent article entitled “Considerations for Including a Trust in Your Estate Plan” describes what a trust can offer. This includes the following:
If your heirs are young, you can set up a trust to stay in effect until they are older and can handle their own finances. Another option is to keep the trust in effect for the lives of the beneficiaries.
A trust can be revocable or irrevocable. A revocable trust must be created during your lifetime. If you change your mind, you can revoke the trust and reclaim the assets as your own.
A revocable trust can offer incapacity protection and probate avoidance but not tax reduction.
An irrevocable trust can be created while you’re alive or at your death. A revocable trust may become irrevocable at your death.
Assets transferred into an irrevocable trust during your lifetime will be beyond the reach of creditors and divorce settlements. The same is true of assets going into an irrevocable trust at your death.
Your family members can be the beneficiaries of an irrevocable trust, while a trustee or co-trustees you’ve named will be responsible for distributing funds to those trust beneficiaries.
The trustee will be responsible for protecting trust assets.
Reference: Fed Week (Oct. 5, 2022) “Considerations for Including a Trust in Your Estate Plan”
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