There are many financial tools that can help you transition from your career to retirement with relative ease and confidence. Understanding those tools, including the benefits as well as the shortcomings, is your first step of making that transition without losing sleep at night. Today, we’ll explore the differences between the Revocable Living Trust and the Family Wealth Trust and what it means for Ohioans.
In some ways, these two Trusts seem to overlap, but it’s those differences that can really allow you to contrast one to the other. A Revocable Living Trust is designed to minimize estate taxes while also avoiding the expensive and time consuming Probate process after your death. The Family Wealth Trust is designed to protect future generations. It allows you to put into place today protective mechanisms that will benefit not only you in the here and now, but can protect future generations as well.
One reason Family Wealth Trusts are so attractive is the versatility they offer. Most are their own trustees and have the option of ensuring the assets continue to grow. Remember, we’re living longer – and that often means we have more years to grow our wealth and build assets. These trusts make it easier to change. Life isn’t static, it’s all about growing and learning and improving; as such, these Trusts are also never static. You can select a co-trustee if you choose. Further, you can include real estate, even if it’s in another state. Should you become incapacitated, the person you selected to take over, steps up to the plate. This eliminates the court making the decision for you. It also eliminates the likelihood of this becoming a drawn out process for your family that can affect them for years.
Speaking of the long, drawn out process of Probate, many of our clients are turning to the Revocable Trust as it’s ideal for keeping your estate private. Probate is public record while a Revocable Living Trust ensures complete privacy and can add an additional protection for your family. Much like the Family Wealth Trust, the versatility of the Living Trust allows you to decide when assets will pass to your beneficiaries. Many like the idea of a slower release so that a lump sum doesn’t tempt a young adult into making a less than ideal financial decision. It can also be withheld until an heir begins college – the possibilities really are endless. Because taxes are always a concern, our team of experienced estate planning lawyers can show you various ways of avoiding an overwhelming tax burden for you and your heirs.
In our ever-changing society, protecting what we’ve worked so hard to build is a priority for most of us. The last thing we want is to lose those assets because we failed to properly plan for life after retirement and we certainly don’t want to leave a burden to our loved ones. Estate planning, though it seems a bit overwhelming at first, is the one way to protect those same loved ones without weighing them down with probate and unnecessary taxes.