Trusts 101

  • Dec 5, 2018

Couple enjoying retirementIt’s hard to put a price tag on the future. A trust helps ensure that your loved ones will be taken care of and can save you and your family from heartache down the road.

A trust is a document that states the rules you want followed to distribute your assets to your beneficiaries and is managed by a trustee.

Trusts aren’t just for the rich and famous; a trust can benefit those with even modest assets. They allow you to pass on your investments quickly and privately, and can save your beneficiaries from hefty estate taxes and probate fees.

Trusts are flexible, varied and complex. Depending on your financial situation, there are many different types of trusts such as charitable, special needs, living and after death. They can also be tailored to protect your assets and give you greater financial peace of mind.

One of the most important aspects of creating a trust is selecting the right trustee. A trustee is responsible for ensuring that your investments, assets, and financial affairs are handled in accordance with your wishes. They also has fiduciary responsibilities to a trust’s beneficiaries for both asset protection and management and must keep extensive records of all financial activities related to the trust.

Here are some ways trusts can help you:

  • Provide for a trusted professional to act on your behalf in the event of death or disability
  • Ensure assets are conserved and not squandered by heirs after you or your spouse die
  • Put conditions on how and when your assets are distributed after you die
  • Provide for your family’s financial needs after your death
  • Ensure privacy for your estate
  • Eliminate probate fees on assets held in a living trust
  • Distribute assets to heirs efficiently without the cost, delay and publicity of probate court.
  • Ensure control and protection over payments and asset distribution to heirs with special needs either during your lifetime or when you die

To some, trusts can be complicated and time-consuming to manage.  Seeking professional advice from a trust service company can make it easier, and help you make the right decision for yourself and your loved ones.

Although it is difficult to think about, setting up a trust could be one of the most generous and caring things you will ever do for them.