LIVING TRUST
Rather than waiting for a life crisis, some professionals are advising some older individuals and couples (primarily those with larger assets) to consider a living trust just about the time of retirement. All assets, such as stocks, bonds, money market funds and property, may be put into the name of the trust. The assets in the trust are held by the Trustee for the benefit of the individual. The parent can name himself or herself as trustee and thereby have complete control of how the assets and income are managed. A Living Trust may be canceled at any time, so the parent does not lose control of his/her property.
By setting up a trust, the person with a larger estate avoids the expensive and complicated process of probate at the time of death. A successor trustee will be named to take control upon the death of the individual, and there can be a provision to allow the successor trustee to act for the individual's doctor to decide when he or she can no longer manage. By this means, the parent and children can avoid the very expensive and uncomfortable process of establishing guardianship. The trustee or successor trustee can be the individual's child, a trusted friend, or a corporate trustee.
The trust can provide for the distribution of the property, after the parent's death, to children, charities, or others; or it may continue to pay income to someone else (i.e., children, grandchildren, friend, etc.) It should be noted that Living Trusts are more advantageous to people who have estates over a certain size.
You should consult an attorney you know and trust for any matters pertaining to your estate. There have been some recent nationwide frauds by organizations with official sounding names selling Living Trusts to seniors who did not need them, and at costs greater than what most local attorneys would charge.
|
