Covington Trust Attorneys
Perhaps you have been considering speaking to knowledgeable Covington trust attorneys but somehow always find a reason to put it off. You are not alone! While the overall percentage of Americans with an estate plan has not significantly changed, the pandemic prompted younger adults to put an estate plan in place. According to caring.com, the number of young adults with some level of estate planning increased by 63 percent during 2020, meaning in 2021, 18-34-year-olds are, for the first time, more likely to have an estate plan than 35-54 year-olds.
Estate planning is a crucial step to take for virtually all adults, no matter the age or financial station in life. Many of those adults will find that a trust is a better choice than a will for several reasons. A Revocable Living Trust is a type of agreement—the Trustee holds legal title to assets for beneficiaries. Many people are afraid they will lose control over their assets if they use a trust as a part of their estate planning, but this is simply not true. A Living Trust benefits you while you are alive in the event you become incapacitated and benefits your loved ones after your death.
A trust also has significant advantages over a Will in that your loved ones will not be required to go through the probate process. Avoiding probate can save time, money and can maintain the privacy of you and your family. The Covington trust attorneys of Adams Law can help you decide whether a trust is right for you and your unique situation. We primarily help those in Northern Kentucky and Southern Ohio from our Covington office but have clients across the entire Commonwealth of Kentucky.
What is a Living Trust?
A Living Trust is a legal document that allows you to distribute your assets to loved ones following your death. A Living Trust “owns” any assets you place in the trust, although you still maintain control. Most all assets with a value can be placed into a Living Trust, such as real estate, bank accounts, stocks and bonds, artwork, jewelry, and anything else of value.
How Does a Trust Work and How Can Covington Trust Attorneys Help?
When your Living Trust is created, you are known as the “settlor,” or the “grantor” of the trust. You decide what you own and what assets you want to include in your trust. So long as you are alive and are not incapacitated, you have full control and access to all assets in the trust. The assets you place into the trust are known as “principal” or “corpus” and will be re-titled from your personal name into the name of the trust.
You will appoint a Trustee to manage the principal of the trust—while you are alive, you would typically be the Trustee, then you would choose a trusted individual to be your Successor Trustee. The Successor Trustee would manage your trust assets following your death or in the event of your incapacitation. Trust assets will be distributed to your chosen beneficiaries following your death. Experienced Covington trust attorneys can ensure your trust does precisely what you want it to do following your death or incapacitation.
What are the Various Types of Trusts?
There are many different types of trusts; however, the most common are: Revocable Living Trusts, Irrevocable Living Trusts, and Special Needs Trusts. A Revocable Trust can be highly customized to fit your specific situation, working well for those who do not have serious tax issues and want to maintain control of his or her assets. The primary purpose of a Revocable Living Will is to avoid probate and simplify the transfer of assets to your beneficiaries. With an Irrevocable Living Will, the primary purpose is to protect assets.
Assets are protected in the event you are sued and are not subject to estate taxes when you die when an Irrevocable Living Will is used. An Irrevocable Living Will can also protect assets from being seized in the event you require long-term care. A Special Needs Trust allows you to leave money to a loved one with special needs without jeopardizing his or her access to government benefits.
How is a Trust Different from a Will?
Trusts are not required to go through probate, which is a significant benefit of trust over a will. When you have a Living Trust, you have named a Successor Trustee who is responsible for distributing your assets—without court intervention—according to your instructions. This means that your beneficiaries can receive their inheritance much quicker than through a Will. Those who own property in other states can find a Living Trust to be particularly beneficial. Without a Living Trust, these properties would be required to go through probate in each state. This could be a true nightmare for the executor of your Will.
While setting up your Living Trust initially may cost a bit more, your beneficiaries can save money after your death by avoiding probate expenses. If you think an individual might potentially contest your Will, it is important to know that Living Trusts typically hold up better than a Will. For married couples, a Joint Living Trust can reap savings in estate and income taxes.
A Living Trust also makes more sense in the event you ever become incapacitated through an accident or illness. If that were to happen, your Successor Trustee would be able to handle your medical and financial affairs on your behalf—with no court intervention. If you choose a Revocable Living Trust, you can always make changes to the trust as your life situations change. Perhaps the one area where a Will is better than a Living Trust is when you have minor children and need to name a guardian. You may also choose a “pour-over Will” in addition to a Living Trust to “catch” any assets that may have inadvertently been left out of the Living Trust.
How Can the Adams Covington Trust Attorneys Help You with Estate Planning?
The experienced trust attorneys at Adams Law can help you set up a Living Trust that most closely meets your needs. Because trusts are complex, having knowledgeable trust attorneys by your side ensures all your questions will be answered, and your estate plan will be adequately prepared. Contact Adams Law today for assistance with your estate plan, particularly Living Trusts.