Creating an estate plan requires that you think about several things, one of which is how you want your assets distributed after your death. You can do this through your will, but that’s not the only option.
Trusts are another option that you have to get assets to your beneficiaries. This is a legal tool that enables you to set specific terms to pass down assets. Understanding a bit about trusts may be beneficial.
2 categories of trusts
There are two broad categories of trusts—revocable and irrevocable. Under these two categories are distinct types of trusts that serve specific purposes. Learning about the similarities and differences between them may help you to make decisions that reflect your wishes.
Revocable trusts are ones that you can change after they’re created. Irrevocable trusts can’t be changed once you set them up unless you’re able to obtain permission from each beneficiary or the court holding jurisdiction over the trust.
One distinct difference between these two categories is that a trustee oversees the irrevocable trust, so you don’t have any control over the contents. That gives you specific protections from your creditors since you can’t access the contents of the trust.
All trusts can bypass the probate process, which provides privacy for the beneficiaries. It can also help them to get their inheritances faster. These are only one component of a comprehensive estate plan. It may behoove you to discuss your wishes with someone familiar with these matters so they can assist you with setting everything up in a way that lawfully reflects your plan.