A trust is an extremely versatile tool for estate planning in California. Last week's post discussed some of the advantages of the living or inter vivos trust. There are other types of trusts, however, each having their own advantages and ability to be tailored to meet a client's specific needs.
Most inter vivos trusts are revocable, which means the creator of the trust can amend or terminate the trust at any time before death. On the other hand, sometimes there are advantages to making a trust irrevocable.
An example of this is the irrevocable life insurance trust, which allows the trustee to have one or more life insurance policies owned and managed by the trust. On the death of the trust's creator, the benefits from the policies can be distributed to heirs without incurring estate taxes.
Another common type of trust is the testamentary trust. Unlike the inter vivos trust, which is established during the creator's lifetime, the testamentary trust is set forth in a person's will. It does not become effective until the trust creator dies.
Testamentary trusts can be used for any number of purposes. One common purpose is to prevent a beneficiary from receiving a large inheritance at a very young age. With a testamentary trust, the assets can be placed in a trust and managed by a trustee until the beneficiary reaches maturity.
Michael A Sawamura Attorney at Law has been helping Sacramento-area clients prepare trusts and estate plans for over 25 years. He is committed to working with each client, helping him or her prepare an estate plan that addresses his or her unique needs. For more information about the estate, please visit our web page. This could provide general information, helping individuals make informed decisions regarding his or her situation.