Anyone with children knows the worry of what will happen to them when you’re gone. After all, even sturdy, successful kids can be knocked off their feet which is why many parents try to leave a cushion in the form of an inheritance. Doing so means building a financial plan that includes how much to save, where to invest, and when and how to take distributions from your qualified retirement plan. Beyond this, it also means figuring out how best to deliver the inheritance you seek to leave. For many, this means a family trust.
Family Trusts and Financial Security: An Overview
Money management skills (or lack thereof) often play into a parent’s worry about their children’s well-being. This is especially true for those with younger kids who have yet to gain financial security or those with children who struggle with addiction or spending issues. In such cases a family trust is crucial.
When you pass on assets via a trust, you gain the ability to specify conditions upon which the distribution of the assets depends, giving you control over how and when dependents receive their inheritance.
Your family trust might, for instance, take the form of a living trust that you contribute to throughout a lifetime and pass on to your children once they have reached a certain age, achieved a certain milestone, or met specific conditions.
Indeed, your entire estate can be passed on using a living trust, and arranging for this comes with benefits beyond simply giving you control over how your assets are distributed.
Your chosen agent does not need to first gain court approval to manage and distribute your assets placed in a trust. This cuts out the need for probate court, eliminating costs, and saving your loved ones from a tedious legal process. When you execute a living trust, you articulate distribution conditions in your trust agreement which ensure your assets end up where you intend. Any chance of a family conflict blowing up into a legal battle is reduced and you pass with the peace of mind of knowing you’ve done all you can to care for those you love.
A final benefit of having a family trust is privacy. Probate court proceedings are public documents which means anyone can view their contents. Assets passed on using a traditional will must be probated. Only a trust allows you to avoid this process. If you worry about third parties snooping through your family’s economic affairs, a trust is your answer.
To learn more about how family trusts support family financial security or to address any other estate planning matter, don’t hesitate to schedule a consultation with Jim Miskell at the Estate Planning Law Group of Georgia either by calling 770-822-2723 or using the contact form on our website.
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