A recent survey found that only 17% of Americans have set up a trust as part of their estate plan. What is worse, only 3% of those asked even mentioned a trust when asked to talk about what estate planning involves.
One of the major issues with trusts is that people misunderstand them. Thanks to the high profile exploits of people like Paris Hilton, many people consider that they are only for the uber-rich. Not something that applies to them and not necessarily something they would want for their children.
Trusts can benefit everyone
There are several different types of trust, and they are something everyone should consider when estate planning. Here are some of the things you could use them for:
- Planning for old age: You can put money into a trust so that someone can pay for your health care if you cannot make decisions or access the funds yourself.
- Avoiding probate: Assets in a trust skip probate, allowing them to reach your family sooner.
- Reducing taxes: The law provides ways to pass more of your estate onto your family and less to the tax office. Failing to take advantage of them is throwing money away.
- Controlling spending: If you do not want money to spoil your child, you can use a trust to restrict how much they receive at any one time.
- Protecting assets from creditors: By placing assets in a trust, you remove them from your estate. If you die with debts, those you owe cannot claim them.
To find out more about creating a trust, seek legal advice. An estate planning attorney can help you understand what type of trust could benefit you and your family.