Having a Delaware estate plan helps ensure your assets end up where you want them when you pass, and it also means less trouble for your loved ones during an already difficult time. While most Delaware residents know that a will is a cornerstone of an estate plan, there are limits to what a will enables you to do.
According to Kiplinger, a trust is another type of estate planning tool that may help you accomplish specific goals, protect your hard-earned legacy and make things easier on your beneficiaries and loved ones. Many people choose to create trusts for one or more of the following reasons.
To protect assets from creditors
If you leave a beneficiary assets in a will and that beneficiary has creditors coming after him or her, they may be able to take the money you intended for your loved one. However, when you leave that beneficiary assets in a trust, those assets become untouchable to creditors.
To control or manage spending
A trust also gives you a lot of power in terms of when you want your beneficiaries to inherit from you. If you have a spendthrift child or a child struggling with, say, substance abuse, you may want to avoid leaving him or her one hefty sum all at once. A trust allows you to set parameters in this regard.
To protect public assistance eligibility
Leaving assets behind in a trust is also smart if you have a beneficiary who collects means-tested public benefits. Leaving that person assets in a traditional sense may disqualify him or her from certain public assistance programs.
This is just the tip of the iceberg when it comes to the various estate planning steps you might be able to take by creating a trust.