While not always easy to think about, adults of any age need to start thinking about wills and estate planning.
For people who have already acquired property and other assets, ensuring what you built goes where you want remains key. Depending on your situation, establishing a trust offers flexibility and puts more control in your hands.
Benefits of a trust
More people have started turning to trust for various reasons. One of the key reasons involves making things easier for your beneficiaries. When you include assets in a will, beneficiaries typically have to deal with probate. Considering that the Delaware Court of Chancery dealt with 1,193 filings and 1,089 dispositions in 2022, that means a potentially long and expensive process. If privacy and tax advantage rank high, a trust provides both. Trusts often stay out of public records and make it easier for assets to get transferred, thus minimizing estate taxes. Depending on the type of trust, you also get peace of mind assets that remain protected from creditors.
Types of trusts
The two most common trusts include revocable and irrevocable. People often chose the former due to the extra flexibility. You have the option to change or add beneficiaries at any time, as well as move assets and change guidelines while alive. Irrevocable offers many of the same benefits except that once you have listed assets and named beneficiaries, you cannot change them in the future. For people with high net worth, this type of trust offers added tax benefits.
When it comes to estate planning, you have many tools available to fit your unique needs.