Setting Up a Trust
Maybe you're thinking about how to better manage your property, or you want to make sure your family will be taken care of after you're gone. If you're having these thoughts, you might want to think about setting up a trust. A trust is basically a transfer of legal title from the owner (the grantor, trustor, or settlor) to an institution or person (a trustee). The trustee then administers the trust according to the trust terms for the benefit of a beneficiary. There are various factors to consider when setting up a trust. These factors include the size of the estate, the age, and marital status of the grantor. FindLaw's Setting Up a Trust section provides information and tips to help you set up a trust.
In this section you can find helpful tips and information on how to amend an existing trust, how to choose a trustee, and how a trust ends. You can also find articles giving guidance on how to put money and other assets – such as stocks and property – into a living trust, and instances in which setting up a trust may not be necessary.
What is a Trust?
A trust is an estate planning tool that can be used while you're alive or for the benefit of your heirs. Each state has it's own laws governing trusts but several states have adopted the Uniform Trust Code, making their laws very similar. There are several types of trusts. Living trusts, AB trusts, charitable trusts are all just a few types of trusts available to people. The type of trust you'll want to set up will depend on what you would like to achieve with the trust.
Is a Living Trust Necessary?
Living trusts have many benefits but they also have some drawbacks. For example, a living trust involves routine maintenance and is harder to change than a will. In addition, it's best to use an attorney when setting up a living trust, which can be expensive. These drawbacks can be outweighed by the benefits of a living trust depending on certain factors – such as age, marital status, and estate size.
A person who is under the age of 55 and healthy, probably doesn't need a living trust because of it takes a decent amount of time and energy to maintain a trust. Marriage can also be a factor when deciding whether or not to set up a living trust. If married couples plan on leaving their property to each other, there are mechanisms in place for an easy transfer of assets after the death of one spouse. Finally, the size of the estate is also a factor in whether it's a good idea to set up a living trust. Smaller estates generally don't have a problem going through the probate process, making a living trust unnecessary.
Hiring a Lawyer
A trust can be fairly easy to set up, so a lawyer is not always necessary. However, a person with a large or complex estate or a unique situation may want to consult with an estate planning attorney for help with setting up a trust. Regardless of the size of estate, it might be a good idea to talk to an estate planning attorney if you have questions or concerns about setting up a trust.