Who needs a trust and who doesn’t – an attorney explains

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by Sharma Foley Affeldt


When do you need a trust?

An attorney gives us the basics of trusts and some common questions to consider when deciding if a trust is right for you.

Most clients who consult with an estate planning attorney will be provided information regarding revocable trusts, a common estate planning tool. Revocable trusts (sometimes called “living trusts” or “inter vivos trusts”) are often used instead of a will-based estate plan to attempt to avoid a public and time-consuming probate proceeding at death and to plan for a client’s potential incapacity during life.

Although generally the same type of planning can be done using a will and a revocable trust (estate tax planning, establishing trusts for beneficiaries, etc.), a revocable trust is generally preferred when a client wishes to avoid the time and expense of a probate and to protect against the need for public filings in a probate or conservatorship proceeding.

Some key questions all clients should consider when determining whether to use a revocable trust-based plan rather than a will-based estate plan are as follows:

  • How important is it for me to avoid the time and cost associated with probate?
  • Would I like to plan now to name agents to seamlessly take over financial management in the event I become incapacitated?
  • Do I own real estate in more than one state, potentially facing multiple probate proceedings?
  • Do I have a complex estate plan involving trust planning upon my death?
  • Can my plan be simplified using beneficiary designations and a transfer on death deed for my real property?

The decision to use a revocable trust plan often has more to do with the client’s goals and composition of asset holdings rather than the size of the client’s estate. To determine whether you are a good candidate for a revocable trust-based estate plan, you should consult with an experienced estate planning attorney who takes the time to thoroughly review your goals and the assets of your estate.

Sharma Foley Affeldt is an attorney with Bridgeview Legal Advisors, PLLC

Catholic United Financial does not offer tax or legal advice. Consult your tax advisor or attorney on your specific situation.