There are a number of advantages of a living trust. These include the following:
- It instructs the trustees to manage the assets of the trusts for the benefit of the life time.
- It renders the trustee a legal right to manage and direct the assets that are held in the trust.
- It names the beneficiaries who are to receive the assets of the trust after you die.
- It also guides and gives powers to the trustee to distribute the assets of the trust.
- It allows the assets of the individuals to pass on to the heirs without passing through the complicated process of probate.
What are the limitations of the living trust?
The beneficiaries cannot save on estate or state inheritance taxes.
Setting up a living trust can be pricey and incur more expenses.
What exactly is a living trust?
A living trust is a written legal document that is formed during the lifetime of a person. These trusts in the US may be revocable or irrevocable. With the help of the living trust , all your assets like the stocks, bank accounts, home are put in to the trust to provide you benefit during your life time after retirement. If the person dies, the trust is transferred to the beneficiaries.
Who are the parties to the Trust?
- The parties to the trust are:
- Successor Trustee
Who are the dependants?
- The dependants are defined as the following:
- A child of the member of the trust
- A spouse of the member of the trust
- A person who is partially or wholly dependent on the trustee member
Advantages of the trust for the benefit of dependants
The trusts that are set up for the benefits of the dependants of the trustee provide benefits to the people who are dependent on the trustee. If the trustee dies or becomes disabled, then the dependants can reap the benefits incurred by the trusts. The trust allows the dependant person to have a secured and a protective life after retirement. Financial crisis can be avoided with the help of the trust. Know which one suits your purposes better and go for the right thing. Take the decision now to secure your future tomorrow.