If you have been thinking of adding trust to your estate plan, you are making a smart move. Even if you have already planned your estate, a Trust can provide an added sense of protection and security. Since there are so many types of trusts, it is easy to be confused about which one is right for you.
For most people, estate planning is a tedious and confusing task. Thinking about your death is not something one looks forward to, but the right Hammonton NJ estate planning lawyer can make you feel confident within your choices. Different trusts serve different purposes, so it is important to understand the differences to make an informed decision.
Different types of trusts in estate planning
- Revocable and irrevocable trusts.
Revocable and irrevocable trusts are some of the most common ones people opt for. A revocable trust is one that can be revoked anytime and for any reason as long as the Grantor is alive and mentally competent to make decisions. On the other hand, an irrevocable trust is just the opposite of that. One cannot revoke it unless all the beneficiaries give consent.
By the sound of it, irrevocable trusts may not seem like a good idea, but they have several benefits. For example, assets in an irrevocable are safe from creditors and lawsuits. Moreover, you do not have to pay taxes on them.
- Marital trust.
Most people assume that when one spouse dies, the other spouse inherits all the money and assets. However, that is not always the case. If you want to make sure your spouse is taken care of after you are gone, you should opt for a marital trust. When it comes to marital trusts, you must choose between separate and joint.
A joint marital trust transfers assets between both the members and is easier to set up. It is also less costly to create. Separate trusts, on the other hand, are different. They can be used to transfer assets to the heirs of the respective spouse.
- Special needs trust.
A special needs trust in Hammonton, NJ, allows you to transfer property for the care of someone who needs special care and attention due to a physical or mental condition. People with special needs are restricted from having an income or assets to continue receiving help from the government.
With the help of a trust, you will be able to legally provide benefits for your loved one while not interfering with the flow of help from the government. Sit with your attorney to discuss how you can plan the best trust for your loved one.