Why Do I Need A Trust – I’m Not Rich

This is one of the most common statements regarding estate planning, and the truth is, you do not have to be rich to benefit from a trust. The goal is to retain as many of the assets you have worked so diligently to earn, and to keep those within your estate. An estate plan can do just this by avoiding court fees and costs of dying intestate.

When setting up your estate plans and figuring out how to protect your beneficiaries, you may be interested in learning about some of the most popular financial and estate planning tools. Setting up a trust is one of the top ways you can help ensure your family avoids probate and set them up for success. Every person should consider whether a trust might be right for them, even if they are not wealthy. When you need legal support creating a trust, do not hesitate to contact an experienced estate planning attorney at Von Rock Law. You can reach us through our confidential contact form or by phone at (866) 720-0195 to get started as soon as today.

Are Trusts Just for Rich People?

Absolutely not! Trusts are not only for “rich people.” Rich is also subjective depending on how you were raised in your financial viewpoints. Some people might consider someone making $100,000 annually to be rich, while others only think wealth begins once you reach $250,000 or more yearly.

Regardless, trust are not only for the wealthy. Trust are an excellent estate planning tool that many people can utilize. If you hope to pass down your assets to your family, a charity, or your friends, a trust is one of the best ways to do it and avoid many of the implications that come with your estate going through probate.

At What Level of Wealth Does a Trust Make Sense?

It may not always be clear when you are in a good place to create a trust. However, generally, once you have a net worth of at least $100,000, it may be in your best interest to consider a trust if a trust is right for you. Keep in mind, as your assets continue to grow, that estates valued at a minimum of $184,500 are required to go through California probate; however, having a Trust in place can avoid this arduous process. You should also consider a trust if you have a significant amount of real estate assets.

Money aside, if you want your beneficiaries to spend your assets in a specific way or follow your specific instructions, setting up a trust is a great way to ensure your wishes are carried out as intended when you pass away.

Why More People Should Consider Setting Up Trust Funds Especially Non-Millionaires

Are you still unsure whether you should consider setting up a trust fund, especially for a non-millionaire? If so, here are some of the top benefits of choosing to create a trust as part of your estate plan:

Tax Benefits

You might be shocked at some of the tax benefits of creating a trust. Once you place your assets in a trust, they are no longer in your name. This means when the trust generates earnings, you will not be expected to pay income taxes on them.

You can save money by lowering your taxable income while you are still alive. Furthermore, when you put your assets in a trust, beneficiaries will not be required to pay estate taxes once they inherit the trust. An experienced San Francisco estate planning lawyer at Von Rock Law can help you obtain as many tax benefits as possible along the way.

Preserve Privacy

Another benefit of having a trust in place is the opportunity to preserve your privacy. When you retain possession of your assets and decide to assign them to beneficiaries through a will, your last will and testament will be made public. This way, if you have creditors or debts you owe to other third parties, they will have the option of claiming your remaining assets when you pass away.

This could have a devastating impact on the amount of money and assets your family members and beneficiaries will inherit. With a trust, the assets contained within them remain private. This means creditors and third parties cannot take away from your beneficiaries to further their financial gains.

Avoid Probate

One of the benefits of having a trust in place is the opportunity to help your family get through your passing more efficiently by avoiding probate. When your estate goes through probate, it will likely be a long and drawn-out process, causing your beneficiaries to wait for months or longer before they can access the assets you left behind. Furthermore, it creates stress and anxiety surrounding whether beneficiaries can ever obtain their inheritance.

The same is not true when you create a trust. Having a trust in place expedites the administration process, allowing closure and healing for the family and loved ones of the deceased far sooner that if the estate were to pass through probate. Since you can set up your trust administration in advance, you can either appoint a trustee who will be responsible for trust distributions or hire a trust management company to ensure your beneficiaries can access their inheritance as you intended. Additionally, when you avoid probate, you can reduce internal family conflicts, which could put your beneficiary’s assets on the line if other family members contest them.

Special Considerations

When you have special considerations, such as chronically ill or disabled family members, having a trust in place is crucial. When disabled or chronically ill family members are on Medicare, or receive Social Security, Medicaid, or supplemental security income, the assets contained within the trust will not be considered. This means they can continue collecting the necessary disbursements while still having access to the inheritance you leave behind.

Minimize Tax Implications

Arguably the most crucial benefit of setting up a trust is the ability to minimize your estate taxes. If you plan correctly, you can save yourself and your family members upwards of hundreds of thousands of dollars. By utilizing annual gift tax exemptions, you can potentially avoid any of the tax implications that come with leaving your estate to go through probate.

A trust is one of the best gifts you can leave your family and loved ones. It allows you to maximize the retention of your assets to be passed down to beneficiaries, while also expediting the administration process.

Contact a California Estate Planning Lawyer to Learn More

Trusts can be an effective way to set your family up for financial success and build generational wealth. When you are ready to learn more about whether a trust is a good fit for your beneficiaries, consider visiting with one of our reputable estate planning attorneys at Von Rock Law to discuss your options further. You can reach us through our online contact form or at (866) 720-0195 to schedule your no-obligation consultation today.

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