Trust Lawyer Teaneck, NJ
If you need legal advice about what a trust is and what it can do for you, then contact our team at Kaplan Law Practice, LLC today. Trusts are useful in estate planning, protecting your assets, and avoiding probate. Many people have heard the term “trust” before, but they don’t know what it is, how it works, and whether they should include it in their estate planning. Here we have discussed in further detail what trusts are and how they can be beneficial for you. However, if you have questions about your individual circumstances, then we suggest contacting our Teaneck, NJ trust lawyer for more information. We can speak with you today!
Why Have A Trust
There are many reasons to develop a trust document. Maybe you want to offer financial assistance to a loved one, such as aging parents, a spouse, children, or your favorite charity. Or, perhaps you are worried that a beneficiary won’t be able to manage and spend the money in a mindful way. In both these situations, you can structure your trust so that your money is used in the way you want it to be. You can also create a trust where the creditors of a beneficiary cannot reach the trust assets to satisfy their debts and liabilities. Furthermore, you can include verbiage in a trust so that a beneficiary cannot demand payment of trust principle without the trustee’s consent. As our dedicated trust attorney explains, these are all specific scenarios, but for most people, the general benefits of having a trust are listed as follows:
- Avoids probate
- Flexibility
- Privacy
- Asset protection
- Tax benefits
- Control over your wealth
- Protect beneficiaries
- Incapacity planning
- Availability of assets at death
- Customize distribution of wealth
- Address family dynamics
Revocable And Irrevocable Trusts
There are two main types of trusts, which are revocable trusts and irrevocable trusts. The former allows you to have control over the trust and the assets you place into it. You can be your own trustee, change the terms whenever you want, add or withdraw assets at any time, and appoint a successor trustee who would take over if you no longer want to manage it or are not able to serve as the trustee due to incapacity. Irrevocable trusts allow you to permanently remove assets from the estate and may only be altered under very specific circumstances.
Kaplan Law Practice, LLC
If you are just getting started with estate planning or need to make updates to your current documents, don’t hesitate to contact our team at Kaplan Law Practice, LLC for support. We know that planning for the future is important to you, and we can give you insight into useful documents that can make a difference for you and your family. Our Teaneck trust attorney is happy to guide you through the process or answer any questions you may have. We are prepared to be of service as soon as you are ready to begin! We hope to hear from you at your next convenience.
Understanding The Difference Between Living Trusts And Testamentary Trusts
Trusts are valuable tools in estate planning that allow individuals to manage how their assets will be distributed after their passing. However, understanding the differences between living trusts and testamentary trusts is essential to determine which type of trust may be more suitable for your situation. Our Teaneck, NJ trust lawyer will share that both trusts provide ways to ensure that your beneficiaries receive what you intend, but their structures and timing differ significantly.
Living Trusts
A living trust, also known as an inter vivos trust, is created during the grantor’s lifetime. It allows the individual to transfer ownership of assets to the trust while they are still alive. The primary benefit of this type of trust is that it helps avoid probate, the often lengthy and public court process used to settle an estate. Because the assets are held in the trust, they can be distributed directly to beneficiaries according to the terms specified in the trust agreement without court intervention.
Living trusts also offer flexibility. The grantor can maintain control over the assets within the trust during their lifetime, serving as the trustee if they wish. They can also modify or revoke the trust at any time, making it a popular choice for those seeking ongoing control over their estate. One of the significant benefits of this type of trust is that it provides clear instructions for managing assets in the event of incapacitation.
Testamentary Trusts
A testamentary trust, on the other hand, is created through a will and only takes effect after the grantor’s death. This type of trust does not help avoid probate since the assets must go through the court process before they are transferred into the trust. However, testamentary trusts can be valuable for individuals who want to set specific conditions for distributing their assets, particularly for minor children or beneficiaries who may need additional protection and oversight.
Our Teaneck trust lawyer shares that one common use of a testamentary trust is to ensure that assets are managed for minor children until they reach a certain age or meet specific conditions. The trustee, appointed by the will, will manage the assets according to the grantor’s instructions. This allows the grantor to provide for their loved ones in a controlled and structured manner after their passing.
Key Differences Between Living And Testamentary Trusts
The main differences between living trusts and testamentary trusts lie in their timing, flexibility, and the probate process. A living trust allows for the immediate transfer of assets upon death without going through probate, while a testamentary trust is subject to probate before it takes effect. Additionally, living trusts offer flexibility during the grantor’s lifetime, as they can be modified or revoked, whereas testamentary trusts do not take effect until after the grantor’s death and are fixed in terms once the grantor has passed.
Both trusts serve unique purposes, and the right choice depends on your individual needs and goals. Those looking for a way to manage their estate during their lifetime and bypass probate may prefer a living trust, while those who wish to include specific terms for asset management after death, particularly for minors or special needs beneficiaries, might opt for a testamentary trust.
Choosing The Right Trust For Your Estate Plan
When planning your estate, it’s crucial to understand the differences between living and testamentary trusts. By knowing how each trust functions, you can better determine which one aligns with your goals for your loved ones’ future. We offer down-to-earth services, making us both approachable and professional. Kaplan Law Practice, LLC is licensed in both New York and New Jersey, and members of our team are here to help you decide which option best fits your needs. Contact us today to consult with a Teaneck trust lawyer who can guide you through the process of establishing the right trust for your situation.
Myths And Facts About Trusts You Should Know
Many people may be deterred from including a trust in their estate planning because they are often misunderstood, which can lead to many misconceptions. Trusts offer a variety of benefits, yet many people hold back because of misconceptions. Below, we’ve outlined common myths about trusts and the facts that clarify their real purpose and utility. Working with a Teaneck trust lawyer serving New York and New Jersey can provide the insights you need to determine if a trust is right for your family and financial situation.
Myth: Trusts Are Only For The Wealthy
Many assume that trusts are only suitable for those with substantial assets. In reality, trusts are valuable tools for people with varying asset levels. A trust can provide protection and specific management of assets for families, regardless of wealth. Trusts help ensure that assets are distributed smoothly, and they may even reduce or avoid probate, saving time and expense for beneficiaries. Trusts are commonly used by individuals who want more control over their assets or to provide for specific needs, such as education funds or future medical expenses.
Myth: Setting Up A Trust Is Too Complicated
Some believe that creating a trust is overly complicated and too much of a hassle. However, setting up a trust is often simpler than expected, especially when you have experienced legal guidance. A trust can be tailored to your specific goals, outlining how you want your assets managed and distributed over time. By setting clear terms, you minimize potential confusion and conflict among beneficiaries. We often find that clients are pleasantly surprised at how efficiently trusts can be set up with the right legal guidance.
Myth: Trusts Only Benefit Your Heirs After Death
Another common misconception is that trusts only come into effect after you pass away. In fact, certain types of trusts, like revocable living trusts, offer benefits during your lifetime. A living trust allows you to manage your assets as usual, with the option to update the terms as your circumstances change. Should you become incapacitated, the trust can seamlessly shift control to a trusted individual of your choosing, helping you avoid potential court intervention. A Teaneck trust lawyer can help you design a trust that provides both lifetime benefits and an effective plan for transferring your assets.
Myth: You Lose Control Over Your Assets In A Trust
One common misconception people have is that by placing assets in a trust, they will lose control over them. In reality, many types of trusts, especially revocable living trusts, allow the grantor—the person who creates the trust—to retain control. You can add, remove, or alter assets as long as you’re alive and mentally capable. Trusts allow you to set the terms for distribution while retaining flexibility, especially with a revocable trust. This flexibility makes trusts highly attractive for those who want to protect assets without giving up control.
Myth: Trusts Are Expensive To Maintain
People often think that maintaining a trust is costly. While it’s true that some costs may be associated with setting up and managing a trust, these expenses are often outweighed by the savings trusts provide through avoiding probate and reducing estate taxes. With regular but minimal updates, trusts can last for years and continue protecting assets with little ongoing maintenance. Many people find that the peace of mind and potential savings make trusts a worthwhile investment.
Myth: Trusts Are Only For Avoiding Taxes
Another misconception is that trusts are merely a way to avoid taxes. While certain types of trusts may offer tax benefits, the primary purpose of most trusts is to provide a structured way to manage and distribute assets. Trusts help prevent disputes, safeguard privacy, and allow the grantor to set specific conditions for beneficiaries. If minimizing taxes is a priority, certain trusts can be structured to maximize tax benefits. However, the benefits of trusts extend well beyond tax considerations.
Exploring How Trusts Can Support Your Estate Goals
Far beyond common misconceptions, trusts are versatile tools that offer numerous benefits. Whether you’re looking to protect assets, manage them during your lifetime, or control how they’re distributed, a trust can be a highly effective solution. As Teaneck trust lawyers, we’re here to help you explore your options and find the best way to address your estate planning needs. Contact Kaplan Law Practice, LLC to learn more about how a trust could benefit you and your family’s future. Our team is dedicated to helping our clients protect their assets and will dedicate ourselves to your success, start to finish.