The Key Elements of Estate Planning

To protect your estate plan, a living trust should be included. It helps your assets after your passing. It easily passes your assets to your beneficiaries, and also helps avoid probate. It is extremely useful and has proven to be a quick and inexpensive way to transfer wealth after an individual’s death. Here are the key elements that you should know for a successful, effective living trust.

A Living Trust Agreement Outline

A living trust agreement outline is comprised of:

  1. The Grantor – The person(s) who creates the trust.
  2. The Trustee – The person given the ultimate authority to manage the trust’s assets. It is essential that an alternate trustee be named in the trust in case the original trustee is no longer able to act.
  3. The Beneficiary or Beneficiaries – The person(s) who will receive the trust assets.

These three roles are integral to the living trust process. Without them, then a living trust cannot properly be established.

The Comprehensive Administrative Provisions

Having comprehensive administrative provisions is vital because it will help to clarify and explain the actions that need to be taken after your passing. It also reduces expenses related to death, the defense of the trust, and allows for the payment of trust expenses. In addition, it prevents a trust contest, protects special needs of the beneficiary/beneficiaries, and states whether the possessions will be given all at once or over a period of time.

Comprehensive administrative provisions are set in place to make the process easier for your trustee, ensures that the trust is properly handled and that the distributions are divided out according to your wishes.

The Difference Between Discretionary Trusts & Pour-Over Wills

In the case of a discretionary trust, the beneficiary does not receive their inheritance all at once. This is typically done when minors are involved. Through a discretionary trust, the power of distribution is given to the trustee instead of distributing their inheritance as a lump sum. To be clear, the trustee has no right or authority to take the distribution of wealth for themselves. They are only responsible for managing the estate until the true beneficiary or beneficiaries comes of age.

Pour over wills, transfer death all funds and assets to the trustee. This will also hold them responsible for burial arrangements.

What You Need in Your Living Trust

1. General Power of Attorney

The types of attorneys, in fact, that you need are durable, financial, and general. Each one handles a different area in an individual’s life ranging from handling non-trust matters such as employment and governmental benefits, retirement accounts and life accounts.

2. Advance Healthcare Directive

Just as you need someone to handle your financial needs, you also need someone to handle your medical needs. With an advanced healthcare directive, they can help you with your medical needs, including incapacitation and enabling caregivers to obtain required medical information.

3. Funding Documents

These documents are among the most vital when it comes to creating a trust-based estate plan. Funding documents include deeds for homes, vacation properties, loan agreements, reservation letters and more.

Don’t go into this process alone! Creating a living trust can be complicated. You need to make sure that you can rely on people who have more knowledge and experience in this area. Contact our office today and we can do the hard work for you so you can rest at ease knowing that your future is protected.

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