The Living Trust

Living Trusts have many uses. You can use a Living Trust to avoid the costs and delays of probate. A Trust can also be used to manage your assets in the event of your incapacity. Trusts can protect hard-earned assets from the creditors of spendthrift children or spouses. You can use a Trust to provide for minor children. A Trust can be used to provide for a disabled person. You might use a Trust to avoid estate taxes. Y

ou can use a Trust to provide for your minor children until they achieve majority. In addition, you can employ a Special Needs Trust to provide for a disabled child of any age without endangering his or her receipt of government benefits. The Special Needs Trust ensures that your child's inheritance will be used solely for his or her benefit, free from creditors' claims, including Medicaid related claims.

You may use a Living Trust to assist you with your own disability. Today, medical science keeps many people alive for significant periods of time who can no longer manage their affairs. A Living Trust can provide an alternative to an expensive and protracted guardianship proceeding.

A Durable Power of Attorney will also provide for the management of your assets in the advent of disability. However, unlike a Durable Power of Attorney, the Living Trust can provide your trustee with a coherent plan to more effectively carry out your desires. In addition, some financial institutions will more readily accept a Living Trust over a Durable Power of Attorney because they have a long history of dealing with them.

A trust can protect your children's inheritance from others. For instance, your child may have many creditors. Or, he or she may have an unstable marriage (60% of all marriages today end in divorce). If your child has a drug, alcohol or gambling problem, a trust may prevent him or her from using your hard earned money inappropriately while still allowing your child to receive an inheritance.

Life insurance is a part of your taxable estate unless you do not own the policy. A life insurance trust may own your policy and avoid estate taxes that might otherwise be due on the proceeds of the policy.

As you can see, Living Trusts can be useful estate planning tools. Like any other estate-planning tool, you should consult with a competent professional. The law of trusts and estates is very complex and constantly changing. A professional can help you apply the choices the law makes available to you in planning your estate .