Five Advantages To Creating A Trust
Regardless of age, income, or the amount of assets you possess, a trust can play an important role in estate planning and is something everyone should consider. There are five main advantages in creating a trust, all of which can help to protect both you and your loved ones.
What A Trust Can Do For You
A trust is an important estate planning tool that allows you to better manage and protect your assets. It involves transferring property and money to a fund which eventually will be passed on to your beneficiaries. This fund is held and managed by a third party, known as a trustee, in accordance with your wishes and in a way that serves your best interests.
Under New York estate planning laws, you have two basic options in creating a trust. An irrevocable trust is one you create that cannot be altered in any way. You can also create a revocable or ‘living’ trust, which allows you to transfer assets while still maintaining control and making any changes as needed. Whichever you choose, the following are five important advantages a trust can provide:
- A trust allows you to avoid probate court proceedings. A major benefit in creating a trust is it can allow you to pass on money and property to your beneficiaries without subjecting them to time-consuming, costly, and potentially contentious New York Probate Court proceedings.
- A trust allows you to place conditions on how property and assets are distributed among heirs. Another major benefit, a trust allows you to provide detailed instructions on how distributions are made to your heirs. It can let you give specific sums on birthdays, holidays, graduations, and other special occasions. It can also allow you to divide an inheritance into periodic payments or even put conditions on the circumstances under which those payments are made.
- A trust can protect your assets from creditors and lawsuits. By avoiding probate court proceedings, a trust protects your assets from creditor claims. It can also protect money or property from being subject to legal judgments in the event a lawsuit is filed against you.
- A trust protects you in the event you become incapacitated. The person you name as a trustee should be someone you can count on to act in your best interests. In addition to distributing money to your beneficiaries, they can also manage your assets in the event you are incapacitated and are unable to handle your affairs on your own.
- A trust can help defray the costs of long term care. Nursing home and long term care costs can quickly deplete any property and assets you have been able to accumulate over the years. A Medicaid trust allows you to transfer ownership, saving you significant amounts of money while preserving your loved one’s inheritance.
Contact Us Today for Help
At Cavallo & Cavallo, we can help you explore your options in creating a trust. To request a consultation in our office, call or contact our Bronx & New Rochelle estate planning attorneys online today.