What Are The Different Types Of Trusts? What Are Their Purposes?

Unless a person has a lot of assets, trusts are not overly useful in Texas. However, special needs trusts can be useful for ensuring that a child or adult person can receive an inheritance without losing government benefits. Trusts can also be helpful in protecting assets from creditors. In my view, having a living trust is like creating a corporation for oneself, which means it requires consideration of a number of things, such as the potential of additional taxes. Aside from avoiding taxes, the biggest consideration is one of privacy. For example, if someone were to put their home in a trust, then they might have to deal with property tax questioning and other added layers of complexity. For most Texans, trusts simply aren’t necessary.

What Are Other Key Components Of An Effective Estate Plan?

In making an effective estate plan, it is key to have a competent attorney made aware of the assets involved and how the creator of the estate plan wants those assets distributed upon their death. A complete estate plan includes several documents, such as a power of attorney, medical power of attorney, HIPPA release form, directive to physician document, disposition of remains document, guardian of minor’s forms, and transfer on death deeds.

How Often Should Someone Review And Update Their Estate Plan?

An estate plan should be reviewed and/or updated any time there is a change in life circumstances, such as an increase or decrease in assets, a marriage, a divorce, or the birth of a child. In addition, changes in legislation might warrant an estate plan update. Power of attorney documents usually need to be reviewed every three to five years to avoid being considered invalid in any way.

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