Have you thought about adding Florida trusts to your Florida estate plan? What exactly is a trust and what can it do for your estate? First, a trust is a legal document that identifies the purpose of the trust, the trustee of the trust and his or her powers, the beneficiaries of the trust, and the requirements for distributing the trust assets to the beneficiaries. Secondly, the grantor must fund or place into the trust his or her assets, such as money or property. Now, you know what a trust is and that it must be funded, it seems simple, so why do trusts often fail? We will share three common ways that a trust can fail.
The first way a trust can fail is by not funding the trust. Most people meet with their attorney, create their trust and have their trust set up and ready to go. Be aware, the next step is where the failure occurs, people fail to fund the trust. They do not add their assets to the trust that they took all the time and money to create. When you put your assets into your trust you may need to retitle your current assets in the name of the trust and then remember to add any later acquired assets to the trust in the future. Be aware, if you fail to put in late acquired assets and leave some assets outside the trust, then your estate will probably need to be probated and your goal of avoiding probate through the use of the trust will not be achieved.
Often the second way a trust is not successful is that many Floridians do not know or have a clear vision of what they actually want out of their trust. For example, your goal may be to create a trust in your estate plan to take advantage of the benefits you may receive, including avoiding probate and simplifying the administration of your estate, but, once again, you must be sure all of your assets are placed into your trust. It is important when creating your trust that you know what you want so that your Florida estate planning attorney can help you. For example: Do you have a child with special needs? Are you divorced? Do you have a charity that you care about and want to support? Again, your attorney can help you create a trust that will enable you to reach your goals for your legacy.
The third and last of the most common ways trusts may fail, is that the trustor does not update the trust. It is very important for you to remember that your trust is a living document. That means you need to update your trust often to be sure that it reflects your wishes and includes all your assets. Meeting with your Florida estate planning attorney, at least every other year, is critical to ensure your plan stays effective and represents what you want. Without this step, it may fail to reach your goals.
We highly recommend that you work with an experienced Florida estate planning attorney so that the trust you are creating meets your estate planning goals and will actually satisfy those goals and will not fail. Your attorney will not only help you establish your trust, but will help you understand how to properly fund your trust so that you avoid all the common pitfalls mentioned above.
At David H. Jacoby Elder Law Advocate, P. A., we are focused on providing thorough, ethical, and timely solutions for our clients and their loved ones. We encourage you to contact us and schedule a meeting with us.