Estate planning is never easy. Drafting a trust is one of the best ways to secure your legacy and ensure your assets get distributed properly once you're gone.
At Blood Law, PLLC, our Waxhaw trust lawyers can help you understand the different options available to you when creating a trust. Throughout the estate planning process, our trust lawyers near Waxhaw will work with you to ensure your trust matches your needs and circumstances perfectly.
What Is a Trust?
Most people are familiar with wills, which allow an individual to determine how their estate is distributed when they pass away and make preparations for the end of their life.
Trusts fill a similar role, enabling you to distribute your assets to friends, family members, or other loved ones. However, trusts also satisfy a unique function in the estate planning process that makes them an invaluable component in most estate plans. If you want to protect your legacy, having both a trust and a will is recommended.
Let's cover some common terms you'll come across when creating a trust. If you're interested in more estate planning terms, you should visit our wills page.
- Grantor. The grantor is the person who creates the trust.
- Trustee. The trustee manages the trust. People often name themselves trustee when creating a trust.
- Successor trustee. The successor trustee takes over the trust if the trustee passes away.
- Decedent. A decedent is a person who has died.
- Beneficiary. A beneficiary is someone named in a trust by the decedent/trustee to receive assets.
Types of Trusts in North Carolina
It's also worth noting there are two different kinds of trusts: revocable and irrevocable.
- If you make a revocable trust (living trust), you can modify it throughout your life (assuming you name yourself as the trustee).
- If you create an irrevocable trust, you cannot modify it after finalizing the trust without the permission of other individuals named in the trust.
Generally, it's safer to create a revocable living trust. That way, if you decide a certain beneficiary shouldn't receive assets or come into the possession of more assets you want to allocate to the trust, you can change the terms of the trust easily.
Why Should I Create a Trust?
Creating a trust enables you to make life easier for your loved ones after you pass away by bypassing the probate process.
When an individual dies, their estate goes into probate. During probate, a court works with an executor or personal representative named in the decedent's will to ensure the decedent's estate is distributed properly.
However, property included in a trust is not subject to probate court. Probate can be a long, expensive process, so distributing valuable property (such as real estate, vehicles, heirlooms, etc.) via a trust can help your loved ones process your passing more easily and have the time they need to grieve.
Additionally, a trust can also be helpful if you want to award property to a beneficiary in a specific way. For example, let's say you have $200,000 set aside in savings for your child, but you want to give them $50,000 a year for four years instead of giving them all that money at once. A trust allows you to make that sort of arrangement.
At this point, you may be thinking to yourself, "well, if I can award property using a trust and avoid probate, why do a need a will?"
A will enables you to do more than just distribute property. You can also establish Durable Financial and Health Care Power of Attorney, allowing you to make stipulations for what care you receive if you become incapacitated. You can also determine guardianship for your child(ren) and name an executor to handle probate for your estate.
For these reasons, it's almost always best to have both a will and a trust in your estate plan.
How to Create a Living Trust
You should work with an established Waxhaw estate planning attorney to develop your trust. Typically, you'll follow these steps as you establish your trust:
- Decide whether you want an individual or shared trust. If you have a spouse, you can create a shared trust with them. However, if you're single or don't want to share a trust with your partner, you can create an individual trust.
- Inventory property and include it in the trust. You'll want to take a complete inventory of your assets to know what you own and work with your attorney to decide what you should include in the trust.
- Name a trustee and successor trustee.
- Work with your lawyer to draft a trust document.
- Sign the document in front of a notary public. If you don't sign the document in front of a notary, it won't hold up in court.
- Change the title on property in the trust. You'll need to change the title on various legal documents, such as your house deed or car registration, to make it clear that property is now part of a trust. Your lawyer can help you navigate this process.
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At Blood Law, PLLC, our experienced Waxhaw trust attorneys can help you develop a trust that protects your assets and secures your legacy. A North Carolina trust lawyer can help you create and manage a trust that meets your specific needs. The Waxhaw trust lawyers at Blood Law, PLLC will ensure all necessary documents are prepared properly, and take care of legal paperwork when it comes time for the beneficiaries to receive their portion, provide advice on how to minimize taxes, protect assets from creditors, and ensure that your wishes for asset distribution are followed accurately. Our experienced trust lawyers near Waxhaw, NC has is proud to serve the families of Union County and will be happy to serve yours.
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