Trust Lawyer
Creating a trust is often a critical factor in securing your financial future for you and your loved ones. It is also commonly an overwhelming process and easy to mishandle assets if you are not working with an experienced trust lawyer. That said, it is highly advised that you hire trusted legal guidance, such as a lawyer at Law Group of Iowa, in order to draft your trust with sincere confidence. People without a legal or business background may be unfamiliar with the benefits of creating a trust and it’s important to be aware of any common misunderstandings regarding trusts. Below, we’ve compiled five myths for you to read through so that you can be more educated on why creating a trust may actually be the right step for you.
Trusts Are Only for the Wealthy
One common myth about creating trusts is that they are only suitable for the wealthy. In reality, trusts offer various benefits beyond just estate tax planning. While trusts can indeed help high-net-worth individuals minimize estate taxes, they also serve as valuable tools for individuals with moderate assets. Trusts can be used to ensure the orderly distribution of assets, provide for loved ones with special needs, manage assets during incapacity, and more. Trusts can be tailored to meet the specific needs and financial circumstances of a wide range of individuals and families.
Trusts Are Only for Avoiding Probate
Another misconception is that trusts are solely used to avoid the probate process. While it’s true that certain types of trusts, like revocable living trusts, can help assets bypass probate, they offer additional advantages beyond probate avoidance. Trusts can provide privacy for your estate, offer more control over asset distribution, protect assets from creditors and lawsuits, and enable ongoing management for beneficiaries who may be minors or lack financial experience. Choosing the right type of trust depends on your goals beyond just avoiding probate.
Trusts Are Irrevocable and Irreversible
Many people believe that once a trust is created, it’s set in stone and cannot be changed. While some trusts, like irrevocable trusts, do have restrictions on modifications, others, such as revocable living trusts, can be altered or revoked by the creator during their lifetime. This flexibility allows individuals to adapt the trust to changing circumstances, add or remove beneficiaries, adjust distribution instructions, and more. It’s important to work with an attorney to create a trust that aligns with your goals and offers the desired level of flexibility.
Trusts Are Only for the Elderly
Contrary to popular belief, trusts are not exclusively for the elderly. While estate planning is often associated with older individuals, creating a trust can be beneficial at any stage of life. Young parents, for example, can establish trusts to provide for their children’s financial needs in case of unexpected events. Individuals with significant assets or specific wishes for asset distribution can also benefit from trusts regardless of their age. Starting early allows you to establish a comprehensive plan that evolves as your circumstances change.
Trusts Are Too Complicated to Understand
The perception that trusts are overly complex and difficult to understand prevents many people from considering them as part of their estate plan. While trust concepts can seem intricate, a skilled estate planning attorney can explain the different types of trusts, their benefits, and how they can align with your goals in clear and understandable terms. A good attorney will guide you through the process, ensuring that you’re well-informed about your options and the implications of each decision. Trusts can be made as straightforward or intricate as needed to suit your needs.