A trust commonly solves two issues that arise in estate planning: avoiding probate and leaving assets to minors. Probate is the court-supervised process by which title to assets are transferred. In simple terms, most people want to avoid probate because:
- It is expensive.
- It is time consuming. It typically takes a year or more to complete probate even with full cooperation from all parties.
- There is a public record of everything that occurs pertaining to the matter.
If any of your beneficiaries are minors, any inheritance they receive must be supervised by a court-appointed guardian, which typically requires lawyers and court appearances. Further, the beneficiary will receive any funds when they legally become an adult.
With a trust, it is easier for the trustee to manage these assets for the benefit of the beneficiary (or beneficiaries) without court supervision. The trustee can designate the age at which a beneficiary may receive the funds, to ensure wise and thoughtful allocation of funds.
- Are any of your beneficiaries minors?
- If your beneficiaries are minors, how do you feel about a court-appointed guardian?
- For your situation, how would a trust benefit your End of Life plans?