When Florida residents create an irrevocable trust, they generally cannot make changes to the document; after all, it is called "irrevocable" for a reason. Of course, this is one reason why many people prefer to plan using revocable trusts instead. The latter are more flexible instruments and offer options that let people make important changes that reflect different circumstances.
Death is something people do not like thinking about, but not preparing for what will inevitably happen is a less attractive alternative. Controlling where assets will go and avoiding family conflict are two basic goals of estate planning, but there are other possibilities as well. A common misconception among many Florida families is that trusts are tools only for the wealthy and are prohibitively expensive to establish. In fact, a revocable trust can be beneficial for many people who wish to protect their families without costing a fortune.
Florida residents who hesitate to create estate plans are not alone. The American Association of Retired Persons reports that more than half of U.S. adults do not have an estate plan in place. However, putting off this task can mean no plan will be in place for becoming incapacitated, the care of minor children or the distribution of assets. All adults should consider the following benefits to estate planning.
Many people in Florida are thinking about how they can best pass on their assets to future generations. Trusts are an excellent method to transfer wealth to children or other loved ones; they can be created to fill unique needs, and they allow assets to be transferred privately without going through the probate system. In addition, people begin to realize the tax advantages provided by trusts right away. However, many people worry about the potential consequences of informing their children from a very young age that a significant amount of money is being held in a trust fund. They may worry that children might not strive for success in school or a career.
Trusts can be a popular vehicle for people in Florida looking to plan for the future and direct the use of their assets. By setting up trusts, people can benefit from avoiding probate and set up clear plans for the disbursement of their funds. However, creating the trust itself is only the first step for people to take when they want to take this route as part of their estate plans. Funding the trust is essential in order for it to operate properly.
Charitable trusts may be ideal for Florida residents who want to ensure that their favorite charities are able to benefit from some of the wealth they have accumulated. Donors can also take advantage of the tax incentives charitable trusts can provide. However, it is important that individuals who want to use the trusts be aware of how they differ from other types of trusts.