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Protect Your Family Assets and Avoid Probate
An easy way to avoid probate when you have substantial assets is to create a trust. A trust outlines what will be done in terms of asset distribution without the courts being involved. While a will distributes your family assets and property after your death, a trust allows you to place your assets and property “in trust” while you’re alive so they will not require distribution after your death.
You will personally appoint a trustee to manage your trust and they will make decisions for your beneficiaries. Besides avoiding probate, a trust makes a smart estate planning tool for the following reasons.
A Trust is Private & So Are Your Family Assets
Probate records are public court records, which means that anyone can look up how your assets and properties were distributed in a will following your death. None of this information will be publicly available when you create a trust because your beneficiaries will not go through the court system.
Trusts Can be Less Expensive – Saving Your Family Assets
Your estate will need to pay for the court fees associated with probate. These can cost anywhere from 2% to 10% of your total estate. You do have to hire a lawyer to set up a trust. Then you can retitle your accounts into the name of the trust. To totally avoid probate, all assets need to be titled into the trust or to “transfer on death” accounts, including the often-forgotten cars.
Benefits are Distributed Sooner
Probate is a process that can require a year or more. If you own homes in multiple states, your family must comply with each state’s specific probate laws, additional court dates, and fee structures if you only create a will. Your beneficiaries may need to wait a substantial time to receive what you leave them, which could put them in financial strain. Since a trust avoids probate, distributions take only a few weeks instead of several months or years.
Setting up a trust is the best way to leave property upon death if you are leaving a large inheritance. Remember you will need the help of an estate planning attorney along with an experienced financial planner to get it right.