What are Trusts?

Trusts are a great tool for estate planning that can help avoid probate, simplify transfer of property upon death, and better effect your wishes should the unthinkable should happen to you.

Many average folks tend to skip the whole conversation about trusts because they are often thought of as a rich man’s game. However, reasonably priced trusts can be not only affordable for an average family, they may in fact be the best option.

Here are some things to consider:

WILLS MUST BE FILED IN PROBATE COURT IN ORDER TO BE EFFECTIVE.

In Texas, the process for filing a probate is more streamlined than in some other states. However, even in Texas, probate costs can costs thousands of dollars and still take months to complete. Meanwhile, your will and your property can be exposed to the public record.

TRUSTS CAN LIMIT YOUR GIFTS TO PROTECT YOUR BENEFICIARIES.

You love your children. You wish to leave them gifts that impact their lives for the better. However, most people would never wish to leave a gift of money to a child that would only empower them to destroy their lives.

When leaving gifts through trusts, it is possible to create trusts that put limitations on what the trustee can give to children in such cases.

Gifts can also be protected from lawsuits, divorced spouses, and creditors of your beneficiaries.

TRUSTS GIVE YOU MORE CONTROL ON HOW MONEY IS DISTRIBUTED.

Whatever your wish for your loved ones in regards to your assets, trusts can be the most effective tool in allowing the money to be distributed in the time and fashion of your choosing.

TRUSTS CAN OPERATE IN YOUR INCAPACITY.

While every good estate plan includes all powers of attorney to allow for the management of your property should something happen to you, property owned by trusts can be immediately managed by a successor trustee should something happen to you.

TRUSTS ARE THE APPROPRIATE METHOD OF SOPHISTICATED PLANNING.

You can do many things with your will, or other documents, including create trusts directly in a will.

“So why don’t I just do a will and then put trusts in there?”

The problem with the question is that it is really asking the more important question,

“Can I purchase a cheaper product and add things to it
to make it work like the higher quality product?”

The answer to the question is that we can always craft a will to leave things to your family in whatever way you choose, but pricing for lawyers isn’t based on products, it’s based on complexity.

The pricing of a complex will plan that has all the language to compare to the methods used in trusts would end up costing the same as a trust, both in time for the attorney to draft it and the final cost to the client. This cost makes the will a less desirable option as it still comes with its inherent weakness of requiring your will to be probated. This is the main reason why most sophisticated plans involve trusts as the foundation of the plan.

The Malolo Law Firm, PLLC, as always is ready and able to discuss this great option with people in the McKinney, Allen, Frisco, and surrounding areas! We offer a free one hour consultation to help find the right plan for you.