Living Trusts

A will is a document regarding your property, how you want it distributed and the people you want to leave it to. Your will can only benefit you after you die. It is a different thing from what you call a living trust, which can already benefit you while you are still alive.

A living trust is not only used to manage your property while you are still alive, but also to determine how this property, your estate and your assets, will be distributed after your death, so in a way, it is still quite similar to a will. Basically a trust will help you manage all your financial affairs. You can transfer all your property into a living trust, and again like a will, you can still make any changes to any arrangements and propositions. After your death, any remaining assets and property can be transferred into the living trust through a Pour-Over Will, and the name is pretty much self-explanatory. If you decide to make a living trust, it is important to make a Pour-Over Will to go with it. The property included in the trust are managed by one person (but it can be more than one, or even organizations as a whole) to benefit another. However the property is owned by the trust. The creator of the trust is called a settlor, and the people he/she has chosen to be beneficiaries of his/her property are called the trustees. The trustees become the legal owners of the property included in the trust, who hold the property for the benefit of individuals or organizations, called the beneficiary, that have been chosen by the settlor.

You can also make joint living trusts. Basically you can combine the property and assets of a married couple together into a single trust and it will be governed by a single trust document and validated by the law. There are certain complications when you wish to make a joint living trust, however, like tax minimization and such, so it is best to consult a lawyer to help you so there wouldn't be any more problems later on.

What Is The Role Of A Probate Solicitor?   New Year's Resolution: Make or Revise Your Will   How Inheritance Claims Can Prove Very Difficult   A Living Will - Your Medical Directive   Special Needs Trusts - What Are They?   The Whole Story About Last Wills and Testaments   

Estate Planning and Incentive Trusts

When you take stock of your assets and recognize the fact that your estate is going to have a considerable impact on the lives of your heirs, it is important to consider the personalities and proclivities of the each individual involved. There will probably be some family members who are ready to receive their inheritances directly with no strings attached at all, but you may have some nagging doubts about others. Younger people who are not established in their own right may lose their way if they find that they don't really have to gain an education and embark on a career path for financial reasons. And others may have personal problems or difficulty handling money, and these types of things can give you reason to take pause.

Incentive trusts are estate planning tools that you might want to consider to address these concerns. With these vehicles you set up the trust to make distributions based on certain stipulations that are intended to guide the beneficiary in the right direction. For example, many people create trusts that provide academic incentives. You may allow for regular distributions as long as the beneficiary remains in school, and provide for a lump sum distribution upon graduation. You can take that a step further and foster an ongoing work ethic by having the trust match each dollar that is earned by the beneficiary in his or her own right.

In addition to encouraging positive choices, incentive trusts can be used to discourage destructive behavior. For example, you could tie distributions from the trust to completion of a substance abuse treatment program, and add provisions for ongoing distributions contingent upon staying free of the addiction or addictions.

These are just a few common examples of how incentive trusts are used, but you can actually create such a trust with any stipulations you choose to as long as they are not illegal. There are obvious reasons to tread lightly and proceed with caution because you don't want your gifts to be met with resentment, but if you use them wisely incentive trusts can be a very useful inheritance planning solution.

What Is The Role Of A Probate Solicitor?   New Year's Resolution: Make or Revise Your Will   How Inheritance Claims Can Prove Very Difficult   Avoid Will and Trust Litigation the Right Way   Working With Estate and Wills Lawyers - What You Need To Know   A Living Will - Your Medical Directive