Estate planning attorneys will most likely agree that trusts are one of the most valuable estate planning tools you can use. Trusts are great at minimizing estate taxes and in avoiding costly probate. There are actually many benefits. However, when it comes to trust administration, it is equally important to understand what is involved and to choose the appropriate trustee.
What exactly is a trust?
Trusts are essentially fiduciary agreements between a trustee and the grantor, who is the person making the trust. Fiduciary simply means the agreement is based on the trust and confidence. The trust document serves to provide needed authority to the trustee to manage the trust assets and distribute them to the named beneficiaries pursuant to the terms of the trust agreement. As an experienced and qualified estate planning attorney can explain to you, a trust may be used in place of a will or may be used in conjunction with a will where it only applies to certain property.
Common goals of a trust
As people accumulate their wealth, grow their retirement accounts, make their investments and purchase assets, they are developing an estate that has value. In estate planning, trusts that are properly drafted can transfer certain assets to a trustee in order to accomplish many of the common objectives of a trust. Those objectives include providing protection for assets and ensuring they are distributed based on your wishes, protecting your estate from substantial taxes and fees, managing your affairs if you ever become incapacitated, and assisting with charitable gifts.
What exactly does trust administration involve?
Regardless of your trust goals, your trust will need to be administered, which involves investment management, implementing charitable giving strategies, risk management, insurance planning and business succession planning, when applicable. The trustee you choose to handle your trust and its administration will be responsible for carrying out the terms of the trust.
Download our FREE estate planning checklist today! If you have questions regarding trusts or any other estate planning matters, please contact us at the Northern California Center for Estate Planning and Elder Law for a consultation. You can contact us either online or by calling us at (916) 437-3500. We are here to help!
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