If you are currently looking into ways that you can establish an inheritance for your family, you likely have many questions about the process. One of the most common inquiries that individuals have in these circumstances is related to the existing debt of their family and whether or not it will impact the financial award they would receive as a part of their trust.
Learning the ins-and-outs of estate planning can be tricky and time-consuming, and taking your family’s debt into consideration may make it even more challenging. However, there are different ways that an experienced estate planning attorney can help you navigate the process of establishing a trust for your family’s future while dealing with their debt.
What is a Trust?
Any individual or couple that is exploring their options for setting up an inheritance for their family has likely come across the idea of a trust. In the public perception, the concept of a “trust fund” is often associated with wealthy families and large amounts of money, but a family of any income level can set up a trust fund as part of their estate planning process. However, there is a difference between a trust and a trust fund that creates a distinction between how the funds are accessed and awarded.
By definition, a trust is a documented legal partnership where a person, known as the grantor, trustor, settlor, or trust maker, entrusts a legal title or any part of their estate to another person, known as a trustee, who oversees the inheritance for the people it is intended for, known as the beneficiaries.
Similarly, a trust fund is an entity that allows the grantor to establish specific rules around their inheritance and how it is accessed or used by the beneficiaries. As an example, you might dictate that the person who is your sole beneficiary cannot spend any part of their inheritance on their debt, or that they may only spend the inheritance on their debt. Trust funds may also be paid out to beneficiaries in designated intervals, and if you wanted to structure the trust fund to pay for your grandchildren to attend school, you could allot a specific amount of fiduciary assistance that would be available to them at a specified time over four consecutive years.
Revocable and Irrevocable Trusts: What’s the Difference?
It may seem as though you can simply create a trust for your assets and move on to the next phase of estate planning, but you have an important decision regarding the nature of your trust. When it comes to establishing a financial trust during the estate planning process, there are two different options: revocable trusts and irrevocable trusts. What is the difference between these varieties of trusts and how does it affect your estate?
● Revocable trusts: As the grantor, you are in charge of your assets until you pass away, after which time your beneficiaries will receive ownership of their inheritance.
● Irrevocable trusts: Once you sign a beneficiary to your estate, the property is legally theirs, even if you are still alive. You may also include a “spendthrift” provision that could protect the assets from seizure by creditors or being lost to bankruptcy.
If you are concerned about your family’s debt and how your estate planning will affect their ability to access or utilize your assets, it is necessary to select the type of trust that best fits your needs and hopes for the future of your estate. The best course of action if you are looking to secure some peace of mind is to contact an estate planning attorney in Orlando that you can trust, like one of the skilled legal professionals at the veteran-owned law firm, Patriot Legal Group.
What are the Benefits of Creating a Trust?
Estate planning can be complicated. With all of the options available to you, how can you know which of them will best suit your needs? One of the common mistakes that people make is not speaking with an experienced estate planning attorney who can help determine the best way of organizing your inheritance, including setting up a trust. Some of the many benefits that come with setting up a trust include:
- Determining how and when your trust is paid out and used.
- Receiving estate tax reductions if it is an irrevocable trust.
- Avoiding potential probate if it is a revocable trust.
- Protection for your assets from lawsuits and creditors.
Being able to protect your assets and feel confident that future generations of your family will be taken care of is one of the most important benefits of instituting a trust. Many individuals find that it gives them peace of mind to know that their estate and their loved ones are looked after. It’s important to find a trusted estate planning attorney in Orlando, Florida, who can help you achieve your trust and inheritance goals.
Contact a Reliable Estate Planning Attorney in Orlando, Florida
When it comes to planning for the future of your family and your assets, you want to work with someone you can trust. The experienced team of attorneys at Patriot Legal Group in Orlando, Florida, has successfully helped a variety of clients secure their inheritance, plan their estate, and establish a safety net for their family’s future.
Don’t wait another day to get started on planning for the future of your assets. Contact the team at Patriot Legal today by calling (407) 737-7222 or reaching out to us online to find out how you can schedule your free consultation with one of our dedicated attorneys. Let the professionals at Patriot Legal Group help you defend your legacy.