Trusts can be a useful way to protect and distribute assets to family members. Here is an overview of the advantages of establishing a trust. For a trust to achieve it’s goals, you’ll also need to appoint a trustee to administer it. Make sure you and your designee understand the responsibilities involved.
Advantages of Trusts
When our affairs and intentions are fairly straightforward, creating a basic last will and testament can be very helpful for our loved ones. Some life circumstances make trusts an important tool for families too. For example, when it would be best to distribute funds to loved ones over time, or only when certain goals are met, a trust is necessary. Learn more about the basics of a trust and different kinds of trusts right here. The Estate Planning Law Group of Georgia points out that families with young children or special needs members can find trusts especially reassuring:
When you pass on assets via a trust, you gain the ability to specify conditions upon which the distribution of the assets depends, giving you control over how and when dependents receive their inheritance.Your family trust might, for instance, take the form of a living trust that you contribute to throughout a lifetime and pass on to your children once they have reached a certain age, achieved a certain milestone, or met specific conditions.
Selecting a Trustee
When working with a lawyer to establish a trust, it’s important to incorporate as much detail as possible about its purpose and terms into the trust agreement. Then consider the qualities, skills and time commitments a trustee will need to successfully administer it. Collins Law Group provides this overview of the duties a trustee may need to undertake:
- Managing and protecting trust assets
• Abiding by the trust terms unless they are impossible, illegal, or unconscionable
• Investing trust funds using the “Prudent Investor Standard”
• Monitoring trust investments
• Communicating with trust beneficiaries
• Resolving conflicts among beneficiaries
• Making discretionary decisions
• Distributing trust funds to beneficiaries
• Approving or denying distributions if given discretionary authority
• Keeping detailed trust records
• Preparing and paying trust taxes
Depending on the circumstances and complexity involved, a relation or friend might make a great trustee, especially if well armed with the details, documents, account and contact information necessary for smooth administration of the trust. When there are complexities, special needs, extensive time commitments or the possibility of conflict involved, it might be useful to appoint a professional trustee. Ultimately, whether a professional, friend, or relation is selected, the trustee has a fiduciary obligation to the beneficiaries—and must always exercise reasonable care and skill in managing the assets of the trust. Accordingly, the trust agreement may require a trustee bond, which is a specific type of fiduciary bond that protects the interests of the trust and its beneficiaries in accordance with applicable state law. As a leading national provider of many types of fiduciary bonds, Colonial Surety makes it easy and efficient to obtain a trustee bond. Just get a quote online, fill out the information, and enter a payment method. Print or e-file the bond from anywhere—even the law office.
Avoiding Probate
Estate lawyers remind us that other advantages of trusts are speed and privacy, since assets passed to others through trusts do not need to go through the public process of probate:
Your chosen agent does not need to first gain court approval to manage and distribute your assets placed in a trust. This cuts out the need for probate court, eliminating costs, and saving your loved ones from a tedious legal process. When you execute a living trust, you articulate distribution conditions in your trust agreement which ensure your assets end up where you intend. Any chance of a family conflict blowing up into a legal battle is reduced and you pass with the peace of mind of knowing you’ve done all you can to care for those you love.
A final benefit of having a family trust is privacy. Probate court proceedings are public documents which means anyone can view their contents. Assets passed on using a traditional will must be probated. Only a trust allows you to avoid this process.
Although these days, most state offer expedited probate processes, the public process of settling our affairs can be time consuming. Unpaid taxes, debts, conflicts among family members or contested wills are examples of issues that can cause complexities and delays during probate. You can learn more about probate and probate litigation here.
Bonds?
Bonds, like trustee bonds, probate bonds, executor bonds and personal representative bonds are often useful in estate law and sometimes they are even required. Across the country, lawyers and their clients rely on Colonial Surety’s efficient online service to quickly obtain a quote, make the purchase and instantly print or e-file the bond. Colonial’s fiduciary bond portfolio includes: trustee, conservator, guardian, personal representative, administrator, estate, executor, probate, surrogate, and more.
In addition to providing bonds directly to the general public, Colonial offers The Partnership Account® for Attorneys .This free business service provides user-friendly client management dashboards, enabling attorneys to easily coordinate, view, complete and e-file the court and fiduciary bonds clients need. See for yourself today: The Partnership Account® for Attorneys.
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Whenever and wherever you need a bond, trust Colonial: www.colonialsurety.com