For generations, the children in your family have learned to swim by jumping off of the dock of your family’s vacation home. It’s a rite of passage for each grandchild to learn how to bait a hook from grandpa while fireflies flicker in the summer heat. The legacy of a vacation home is the pinnacle of the American Dream. Many people work their entire lives to afford a home in their dream destination. While you dream of passing down this home (and the memories) for generations to come, have you thought of how to protect this family legacy? Leaving the family vacation home directly to your children may be the simplest way for transferring ownership, however, when multiple children are involved, they would all need to agree with how the property is managed and maintained in the future. These decisions are proven to be challenging not only for your children
Continue Reading... →Posts Tagged Irrevocable Trust
Irrevocable Living Trusts, when properly designed and implemented, can provide an almost unsurpassed level of asset protection from the high cost of long-term care. And, like Revocable Living Trusts, they spare your family the delays, frustration and expenses of the probate process. Other reasons to utilize an Irrevocable Living Trust include: Tax minimization Avoiding the risks of placing assets in the name of your children Protecting assets against predators, creditors and lawsuits While many different types of Irrevocable Living Trusts are available, in essence all of them re-title your assets. Assets placed in an Irrevocable Living Trust can include a business, cash, investments, life insurance policies, and more. Why is an Irrevocable Living Trust better than a Revocable Living Trust at protecting assets against the cost of long-term care? Under current Medicaid laws, assets in a Revocable Living Trust are not fully protected. Why? Assets in a Revocable Living Trust
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Last time we discussed some of the terminology associated with trusts. Now let’s look at how revocable trusts differ from irrevocable trusts and the benefits of having a trust. Revocable versus irrevocable trusts A revocable trust is a trust that can be altered by the grantor during his or her lifetime. An irrevocable trust, on the other hand, is a trust that cannot be changed by the grantor (except under extraordinary circumstances). In the case of irrevocable trusts, the grantor typically foregoes total control of the property and must obey all trust rules and guidelines. Furthermore, a trust can be revocable during the grantor’s lifetime and then become irrevocable upon the grantor’s death. When most people use the word “trust” in the context of estate planning, a revocable living trust is the one they have in mind. A revocable living trust allows you to maintain complete control over your assets
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