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Why Have a Trust?Q:
Why have a trust?A:
Trusts have many uses. They include:
- Protecting the assets of minors or other persons who would have difficulty handling the assets
- Protecting your own assets in the event you become disabled. You could create a trust naming a third party, such as a child or financial institution as a trustee. Or, you could be the trustee of your trust and provide for a successor trustee to take over in the event you become incapacitated.
- Avoiding probate. Probate is necessary in most states in order to transfer ownership of assets owned by a deceased person to the rightful beneficiaries. If all of your assets are in a trust, your death doesn?t change the ownership, so no probate is required.? This frequently means that your estate plan is more private and the costs associated with your death will be reduced.
- Providing benefits to both a charity and an individual. For example, through a charitable trust, you could provide that income is payable to you and your spouse during life, and on your death, the remainder of the trust goes to charity. Or, you could provide that a charity gets the income for a certain number of years, and then your children take the remainder.
- Providing for your pet. Most states now allow for a trust to be established for the care of a pet.
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Answered by Planned Giving Expert
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