No matter how much or how little you might be worth, it’s important for you to have an estate plan so that the maximum amount of your assets are passed onto your chosen beneficiaries. Adequate planning and a trust fund will help reduce the likelihood of family disagreements, unanticipated taxes and high probate costs. However, if a trust is not properly set-up it could potentially be ignored by the courts and become ineffective.
A trust fund is a fund composed of various assets (cash, stocks, property etc.) aimed to provide advantages to either an individual or a class of beneficiaries. Its purpose is to provide financial security for the beneficiaries, such as children or grandchildren, or even perhaps a charity.
Trust funds can achieve a range of objectives but just because something may have worked in the past for someone else, it doesn’t mean it will necessarily work for you. With this in mind, make sure you take the time to plan carefully and determine what it is you’re really looking for and what your goals are. For example, do you want to leave your assets to your children and grandchildren or donate them to a charity?
Depending on what type of assets you are trying to protect, there may be certain trust funds that better meet your requirements than others. In addition, different types of trusts have different tax implications; another factor worth considering.
Deciding what to do with your assets and how to do it can be a very complicated process and we recommend you professional advice. If you have any questions you’d like us to answer, please don’t hesitate to get in touch, or head to our Types of Trust page to find out more.