Several myths surround trusts that discourage people from learning about them.  Lets look at some of them.

Trusts are for the very wealthy:

Untrue:  Trusts can be for anyone with assets or beneficiaries that need to be protected. There is no minimum estate value that is needed to create a Trust.  Robert Massi, an attorney and the legal consumer analyst for Fox News Channel.  Recommends that everyone that owns a home should consider having a Trust.  In the past Trusts have been associated with the super wealthy.  Today law schools teach the creation of Trusts along with other estate planning tools such as Last Wills.  In fact it may be considered malpractice to fail to consider whether a Trust needed in an estate plan for any income or asset bracket.

Trusts are complex and difficult to understand:

False:  The truth is that Trusts are relatively simple in their basic form.  In a family revocable Trust the client executes a document, changes title on property then acts like nothing has changed.  The client continues to use the property just as before.  Bills are paid from the same checking account.  The only difference is the client becomes a Trustee.  The Trust document spells out provisions that take affect upon the passing of the client.  In fact it acts like a Will in many respects.

Trusts require complex tax returns:

Incorrect: While the client is living a family Trust does not require any separate tax return or reporting.  The client continues to file his or her own tax returns.  Once the client passes there may be a requirement for a tax return for the Trust, but not before.

A Trust is unnecessary if there is a Will:

Not Exactly:  A Trust can do many things a Will cannot:

• A properly funded Trust avoids probate
• A Trust can delay distributions to beneficiaries until certain ages, milestones or indefinitely (a simple Will cannot)
• A Trust can prevent vulnerable or foolish beneficiaries from wasting money with Spendthrift provisions

Trusts can be done without an attorney

True:  However, many attorneys hire other attorneys to prepare their Trusts and Estate Plans.  This is because attorneys recognize that many devastating mistakes can be made and value the experience of a colleague.

Learn more about Estate Planning, Family Trusts Here.