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Conway Estate Planning Blog

Trusts can handle specific estate planning wishes

Making headway on an estate plan can be exciting. Arkansas residents going through this process may feel accomplished and relieved that they are tackling such an important task. Though some may start out with only the basic tools, others may want to branch out their estate planning efforts by using trusts.

If individuals are considering trusts, they may begin to wonder whether they really have a need for this extra tool. In most cases, anyone could benefit from adding a trust to his or her estate plan. After all, a trust can better protect assets in many ways. Plus, individuals can set up trusts for specific purposes and of specific types to ensure that their particular wishes for that trust are carried out.

Three benefits of creating an estate plan

As people get older, they naturally think more about the legacy they will leave behind. You might also think about what assets or property you are going to leave behind as well. However, unless you have an estate plan in place, your strategy to provide for your children and grandchildren may not go as you intended. Without this legal document in place, your heirs will not receive what you specifically set aside for them.

Considering trustee candidates is important when estate planning

Many Arkansas residents make the wise choice to include trusts in their estate plans. This tool can add numerous benefits to any plan and can bring more peace of mind to those who are estate planning. Of course, it is important to remember that a trust needs a trustee and that choosing the right person needs some thought.

Many people choose family members or close friends to act as trustees, and those options are perfectly acceptable. However, it is important to consider whether the family dynamic could have negative effects on an appointment. Some family members do not always get along well, and if one person is put in charge, others may feel slighted or think that the chosen person will not handle the role well. If this is a concern, it is possible to consider professional trustee services.

Available assets can help fund trusts now

Throughout life, most Arkansas residents work hard to generate assets that can help them maintain a desired lifestyle and allow them to care for their families. Because it does take such hard work to reach this point, most individuals want to protect their assets as best as possible. Fortunately, trusts can help them do that.

One of the biggest benefits of a trust is that it can help individuals keep assets out of probate. This is useful because it means that those assets will not be diminished by probate costs and cannot be given to creditors to cover outstanding debts. Additionally, the assets can pass directly to the trust beneficiaries almost immediately after the trustmaker's passing (or at another designated time) rather than having to wait until the completion of probate, which can take months, if not years, in some cases.

Can trusts help donate assets to charity?

Protecting assets for loved ones and making sure that they have what they need is important to many Arkansas residents. However, it is also common for people to want to help those outside their families by volunteering or donating to charity. For some, donating assets to charity after their passing is something they want to accomplish, and fortunately, trusts can help.

First, parties considering this option may want to note that there are different types of trusts that can help them achieve their charitable giving goals. Some individuals may want to opt for a revocable trust and simply name the desired charitable organization as a beneficiary. Trustmakers can designate the amount that should go to charity and specify how the funds should be used, if they wish to do so.

Trusts can help manage assets for minor children

When making important decisions in life, many people can make similar decisions but for vastly different reasons. For example, some Arkansas residents may choose to create trusts as part of their estate plans because they want to protect their assets. On the other hand, others may have minor children who could not manage their inheritances in the event of their parents' passing, and a trust could help. Fortunately, this planning tool is versatile enough to fit most people's needs.

Creating a trust for the inheritance of a minor can be immensely useful. Because a minor cannot directly inherit assets, the parents could name a trust as the beneficiary of the assets. If they should meet an untimely demise, the assets would pass into the trust, and the trustee that the parents chose would manage the assets. This can be helpful because it allows parents to choose a trustworthy person to manage the assets until the child comes of age rather than having the court appoint a person.

Could a professional be best for trust administration?

Finding the right tools to protect assets and wealth does not have to be impossible. Many Arkansas residents could benefit from creating trusts to protect their property and ensure that it is managed properly. Of course, trust administration can have its difficulties, and individuals may want to make sure that they have a trustee who can handle anything that comes their way.

One option that individuals could consider is a corporate trustee. A corporate trustee is a professional who has experience in managing trusts and who has the financial know-how to ensure the protection of assets. While individuals could choose to utilize a family member or close friend to act as the trustee, that person may not know how to handle complications that could potentially arise with the trust.

Special needs trusts can prevent jeopardizing government benefits

Wanting to ensure that their children are well cared for is a goal that most Arkansas parents have. If parents have a child with special needs, they may have specific concerns about the type of care and the amount of money the child will need in the future. Though government benefits can often help with financial aspects, parents still typically want to leave their children an inheritance, which is where special needs trusts often come into play.

Because government benefits often hinge on financial qualifications, if a person receives a significant inheritance, it could end up disqualifying that person for much-needed benefits. Fortunately, a trust can allow parents to provide for their special needs child without jeopardizing those benefits. This works by placing the intended assets into a trust, which remains separate from the child's estate and direct ownership.

Living trusts can be a useful part of estate planning

Including a trust in an estate plan is something that many Arkansas residents feel is important. Creating a living trust can allow individuals to create the document during their lifetime and while they are estate planning. This type of trust can be immensely useful, and interested parties may want to know how to set one up.

First, individuals need to decide which type of living trust they want to create. A revocable trust can be changed, while an irrevocable trust cannot be. An assessment of one's estate and assets can help with that decision. It can also help when it comes to the next step, which is deciding what will go into the trust. If a trust is not funded with assets, it essentially has no purpose.

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