There are a lot of reasons why it’s a good idea for nearly everyone in Houston to have a solid estate plan. Whether such plans should include the creation of one or more trusts is something that can be assessed in consultation with an experienced attorney.
These days there may seem to be fewer reasons for establishing trusts. Many governments have made it easier to pass most assets on to designated beneficiaries, reducing how long any assets are held up in probate. But rather than sidelining trusts, it might be better to think of them like special teams in football.
In that vein, here are some scenarios in which a trust might be appropriate, even in cases of modest estates.
Perhaps a spouse is concerned about the spending practices of his or her mate. Setting up a trust, administered by a trustee, allows for greater control over asset distributions. If the spouse remarries and starts a new family, a trust can ensure the property stays within the lines of original family succession.
Trust restrictions might be useful, too, to provide for children or grandchildren and protect them from potential profligate spending. But on the flip side, they can also offer the grantor a way to encourage the development of desired behaviors, within reason.
There may be advantages in setting up a trust for a special needs beneficiary in the family. This might be particularly important if maintaining health care coverage through Medicaid is a priority. A trust could receive third-party contributions that can help the special needs person. As long as the money is used appropriately, government aid shouldn’t be at risk.
Another plus with trusts is that if they are properly structured, they can adapt. Tax and trust laws do change over time and a trust needs to have flexibility to change with them if necessary.
With proper thought and action, you can create a legacy that reflects your goals, desires and care.