No one likes to think about his or her end of life, but you can’t avoid the inevitable. Planning financially for you and your family’s future can help put your mind at ease. Having a solid plan in place can ensure your family is well taken care of after you are gone. As such, a living trust can be an invaluable planning tool.
A living trust allows you to decide how your assets, property, vehicles, stocks and bonds, bank accounts, family heirlooms including antiques, jewelry, and collections, are handled.
Revocable Versus Irrevocable Living Trusts
There are two types of living trusts – revocable and irrevocable.
A revocable living trust is just that, it can be revoked at any time. This trust allows you more flexibility and the ability to move assets in an out of the trust whenever you see fit. You have the right to revoke or amend the trust at any time. You receive the income and/or principal of the trust and you also control the trust as the trustee. You must, however, report the trust income on your tax return.
An irrevocable living trust is permanent, including the assets that are placed in the trust. Once this trust is determined, changes cannot be made.
When to Use a Revocable or Irrevocable Living Trust
There are a few common reasons why someone would want to set up a revocable living trust as follows:
- They want to avoid delays and the expense of probate.
- They own property in more than one state.
- They are concerned that a family member will challenge (contest) his/her estate plan.
On the flip side, setting up an irrevocable living trust can make sense if:
- They want to protect assets for their family in the event they suffer a catastrophic illness and necessitate long term care.
- They want to save on estate taxes.
Do I Need A Living Trust?
There is no specific determining factor deciding if you need a living trust or not. But, if you’re looking for additional protection for your assets and want to ensure your family is provided for appropriately after you’re gone, setting up a living trust can give you great financial peace of mind.
Interested in Learning More About Trusts?
We’re hosting a series of free educational seminars entitled, “Trusts-Do I Need One?” During these seminars, we will be discussing why someone may need a trust and which trust, irrevocable or revocable, would best fit their situation.
Join us for our upcoming seminars:
- August 10th from 9:30 am – 11:30 am at Russo Law Group Bay Shore Office (45 Park Ave.)
- August 13th from 3:00 pm – 5:00 pm at Borrelli’s in East Meadow (1580 Hempstead Tpke)
- August 14th from 12:00 pm – 2:00 pm at Greene Turtle in Smithtown (716 Smithtown Bypass)
- August 15th from 12:00 pm – 2:00 pm at The Cuban in Garden City (987 Stewart Ave)
- August 17th from 12:00 pm – 2:00 pm at Russo Law Group Lido Beach Office (250 Lido Boulevard)
Registration is required to attend any of these seminars, please register by clicking here or by calling Ashley at 516-393-3164.