Creating a trust is often a part of an estate plan.  Many times people are very reluctant to actually do the things needed to prpare for their eventual debt. However, choosing which trust best suits your needs can be somewhat confusing.  This article summarizes the basic elements of each type of available trust and how they may benefit you in creating your estate plan.

Which to Choose When Creating a Trust

1. Revocable Trusts

Many estate lawyers use the revocable trust when creating an estate plan for clients.  This is because a revocable trust has many advantages.  First, when you place your assets in a revocable trust you still have immense control over the administration of them.  Second, you can amend, end, or change the trust at anytime to account for any unforeseen events.  These trust only become irrevocable upon your death.

2. Irrevocable Trusts

Most estate lawyers will not suggest an irrevocable trust, except in certain situations.  This is because these are extremely difficult to change once you put them in place.  Irrevocable trusts are generally a tool for people who have a lot of money and want to provide an endowment for a charity.  This will separate the assets from your estate for tax purposes, but still allow you to direct the use of it by the charity.

3. Testamentary Trusts

Testamentary Trusts are a type of trust that becomes effective when you pass.  Many people creating a trust for their heirs will use this type of trust to provide for minor children or grandchildren.  You can set the rules that the trust will abide by.  So, if you only want a portion of the trust available at a time, you can do that.

4. Intervivos Trusts

You may recognize the term “living trust”.  This is an intervivos trust and is very common for people to use.  Generally, these are revocable in nature.  Again, you can be the trustee of your trust and have significant control over it.  However, you must have a specific reason for the trust to exist.

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Claremore Attorneys Creating a Trust for You

Beginning your estate plan and creating a trust can be an easy process with the right help.  You must first fill out a valid trust document.  You can find a form online, but need to verify it is valid.  The form must name the beneficiary, the trustee, and have you sign it in front of a notary.  As this point, you can make transfers of assets to the trust.  While the process appears simple, we suggest you have an attorney walk you through it.  This will ensure that your trust meets all the valid criteria and will remain intact upon your passing.  Your first consultation with us is free.