In addition to a will, a trust is one of the most important estate planning tools to have. Like a will a trust is a way to leave assets to your loved ones. However, trusts have important benefits that a will cannot offer.
A trust is a legal entity that holds assets for the benefit of another person. It is managed by a fiduciary known as the trustee who makes decisions as to how to manage the trust assets to benefit the trust beneficiaries, according to the terms of the trust agreement. As trusts can be complicated, consider consulting Estate Attorneys in New Orleans who will be able to explain to you the benefits of a trust and how one might help you and the beneficiaries of your choosing.
The Different Types of Trusts
There are several different types of trusts each with different features and different financial benefits. Estate Attorneys in New Orleans will be able to let you know which type of trust is appropriate for your needs.
Special Needs Trust
If, for example, you are concerned about the future of your child who has Down’s Syndrome, autism, cerebral palsy, or some other severe and persistent disability, Estate Attorneys in New Orleans will explain how a Special Needs Trust (SNT) may be a way to give you peace of mind.
A SNT is a specialized trust designed to provide funds to disabled beneficiaries without jeopardizing the beneficiaries’ eligibility for income-based government benefits such as Medicaid. In order for a SNT trust to remain qualified, the funds from the trust may only be used for quality-of-life expenses such as specialized equipment, education, and an aide.
If you want to leave a sum of money or an asset to help a particular cause, you can do so through a charitable trust. There are several types of charitable trusts, each with different income and estate tax benefits. Estate attorneys in New Orleans will be able to advise you as to which type of charitable trust will best meet your personal and financial goals.
Minor Children Trust
Even if you leave your minor children outright gifts, someone else will have to manage those funds or assets until your children reach the age of majority. Thus, it is best to simply set up a trust either while you are living or through your will so that you can set forth the terms of how you would like your children’s assets managed and who you want to manage them. In the trust agreement you can specify at what age you would like your children to have outright access to the funds, commonly at the age of 18 or 21.
If you would like to give someone a large sum of money but that person has a history of poor money management, it may be a good idea to set up a trust with “spendthrift” clauses to hold those funds for that person’s benefit. Such trusts are designed to protect the assets from a beneficiary who might otherwise spend the money quickly and unwisely.
In addition to special needs trusts, charitable trusts, minor trusts and spendthrift trusts, there are other types of trusts that may fit your needs. To learn more about trusts and how they may work for you, discuss your planning goals with experienced Estate Attorneys in New Orleans at Barrios Kingsdorf & Casteix LLP.
The New Orleans Probate Lawyers at Barrios Kingsdorf & Casteix, L.L.P. will help you with all of your probate problems. Schedule an appointment with the experienced estate administration attorneys New Orleans today for assistance.