You have probably thought about what will happen to your estate when you are gone. Will your heirs mismanage their inheritance? Will future generations benefit from the family wealth?
You may want to consider including a trust in your estate plans if you have such concerns. You can reap the asset protection benefits of a trust and protect your loved one’s interests for years to come.
How a trust can help
The legal arrangement of a trust involves a third party (known as the trustee) managing trust assets on behalf of the beneficiaries. Appointing a trustee with the financial expertise and experience to oversee trust assets can help avoid the mismanagement of your family’s legacy.
In addition, you will not have to worry about the possibility of your family fortune falling into the wrong hands. Assets held in a trust are safe from creditors since they legally belong to the trust. They cannot be seized or repossessed to settle a debt owed by a beneficiary, nor can they be divided after a divorce.
A trust also offers you more control over the fate of the family estate even after you are gone. As the person who creates the trust, you can specify the terms and conditions the beneficiaries will benefit from trust proceeds.
Lastly, a trust will help you avoid probate, which can be costly due to the attorney fees and estate taxes involved.
Understand your options before creating a trust
Given that there are so many kinds of trusts to choose from, it is worthwhile to learn more about how they work before creating one. It will be much easier to pick the ideal trust that will help secure your family’s legacy when you have the proper information.