USING A TRUST
When developing their estate plans, California residents should strongly consider using a trust. One type of trust solution, the revocable, or living, trust, is often chosen.
A revocable trust can be easily amended, which can be beneficial to people who have children. As their children grow older, settlors may reconsider certain parts of the trust they created. Estate plans, including trusts, should be regularly reviewed every five years at the least.
There are multiple ways a revocable trust can be structured. For situations in which there is a working spouse with minor children, and the trust is to be funded when the settlor passes away, the spouse can serve as the primary beneficiary as well as the successor trustee. As trustee, the surviving spouse will have the authority to distribute the trust income and principal for the surviving household. The funds from the trust may be used to pay for the children's education through the completion of college. When the youngest child reaches a certain age, such as 25 years old, the trust can be divided so that there is a separate trust for each child.
Another popular type of revocable trust for a retired spouse with adult children and grandchildren is one that is funded when the settlor dies. The trust receives the funds from the settlor's retirement account, and the surviving spouse serves as the primary beneficiary of the trust in addition to the successor trustee.
An attorney who has experience in trust and trust administration may help individuals determine the types of trusts to include in their estate plans. A lawyer may consider his or her clients' circumstances and goals while helping them draft trusts that make sure that their wishes regarding the management and distribution of their assets will be honored after their death.