A trust is a fiduciary arrangement that allows a trustee to control assets on behalf of named beneficiaries. The benefit of trusts is that the holder of a trust can express exactly how and when assets pass to beneficiaries or limit the use of the funds to particular expenses.
Trusts can be set up while you are still alive or a trust can be stablished within the terms of a will. If you’re looking into setting up a trust, contact an estate law specialist in Bossier City.
Here are three helpful tips to consider if you’re looking to set up a trust:
- Determine your beneficiaries
Beneficiaries can be named by individual or by class such as “my children,” “my grandchildren,” “my descendants,” or “members of a specified group.” Knowing in advance how you plan to divide your estate will save you and your estate lawyer valuable time. The Trust agreement should provide how the trust estate will be distributed if any of your beneficiaries predecease you. In other words, will the assets be distributed to the remaining beneficiaries or will there be a substitute for the beneficiary who died. - Determine the best trust for you
Choice includes a living trust or a testamentary trust. There are benefits to both kinds and your expert estate lawyer can help you determine the best route for your estate. Additionally, determining whether your trust will be revocable, able to be modified or take back any time while the you are alive, or irrevocable, set up to shelter your estate from creditors or to help them qualify for Medicaid. You also need to determine if the assets shall all be distributed to the beneficiaries or if the assets may be used to pay certain expenses of any beneficiary such as tuition. - Determine a trustee
Your trustee will manage your trust and ensure that your estate is distributed as you planned in your legal documents. Friends and family are the most common trustees for simple trusts. Bank employees are often used when you have no living relatives qualified to manage the trust assets. Additionally, a professional trust manager may be used when the estate is large and diverse.
