Have you considered what happens to your estate after you pass away? With an estate plan, you can decide who will benefit from your estate. One key document you can add to your estate plan is a trust. A trust allows you to arrange for the distribution and management of assets with the help of a trustee. The trustee can fulfill the instructions you leave behind with your trust, which can help avoid probate, taxes and disputes.
A trust is a complicated document that can be used to make special requests. Here are a few unique trusts to consider making:
Controlling how your assets are used
You may want a beneficiary to use assets for a very specific cause. For example, you may wish for your beneficiary to go to school, complete their education or further their education. With an incentive trust, you can make a clause that allows the beneficiary to access funds if, for example, they receive high grades in school. Otherwise, their access to those funds would be limited.
The only danger here is that you probably want to leave “escape” clauses that account for situations outside of your beneficiary’s control that might limit their ability to fulfill the terms of the trust. For example, if your beneficiary becomes disabled and unable to attend school, you may want that money to go for their care.
Leaving behind assets for your pet
Who will care for your pet after you pass away? You do not have to worry about that with a pet trust. You can set up a pet trust to distribute assets for pet-related expenses.
For example, your pet may have a caretaker who can access funds to pay for your pet’s vet bills, medication, shelter, food or grooming. The trust could pay out funds that are designed to make sure that your pet has everything they need for life.
Preserving assets for future generations
If you have grandchildren, you may want to leave something behind for their future. You can create a generation-skipping trust that skips one generation for the benefit of the next. This trust can also avoid a lot of unnecessary taxation, which can help build generational wealth and ensure your legacy.
Your future is in your hands with an estate plan. You can learn more by reaching out for legal help.