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Trusts
The document discusses the importance and function of trusts, highlighting their benefits such as avoiding probate, protecting assets from lawsuits and creditors, and allowing for active management during incapacity. It explains that a trust is a three-party agreement involving a grantor, trustee, and beneficiaries, and discusses the characteristics of a revocable living trust, where the grantor maintains control over assets. A sample case illustrates how trusts can be used to protect beneficiaries from themselves, reinforcing their legal validity.
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Trusts
- 1. Trusts COURTESY GARY DEWITT DEWITTLAW FIRM, PLLC (479)717-6300
- 2. Trusts In General.Why a Trust? Avoid probate Protection from lawsuits Protection from creditors Control – now and later Protection of Assets
- 3. Trusts In General.Why a Trust? Active management of your assets during incapacity Can control (“strings”) the assets even after you are gone Can name successors Somebody to advocate for your finances
- 4. Trusts In General.Definition. A 3 party agreement Grantor, Trustee, and Beneficiaries Grantor puts stuff into trust (possibly you)
- 5. Trusts In General.Definition. A 3 party agreement To be managed by the Trustee (possibly you) For the benefit of the Beneficiaries (You, your family, your loved ones)
- 6. Trusts In General.Definition. What a mouthful Required Grantor, Trustee, Beneficiaries, Agreement, and stuff (the “res”)
- 7. Trusts In General.Definition. It’s a bucket you put stuff into You also put a set of instructions in the bucket for the “trustee” to follow You can lock the lid to the bucket
- 8. Revocable Living Trust Youcreate the trust while living You can revoke because it is revocable You can modify because it is revocable
- 9. Revocable Living Trust Youput stuff into it, so you are the Grantor You manage the stuff, so you are the Trustee You (and possibly others) get the benefit from the stuff, so you are the Beneficiary
- 10. Revocable Living Trust Whatdoes this mean? You put stuff in at will You take stuff out at will You can modify the trust agreement at will You can revoke the trust (revocable) You are in full control
- 11. Choosing A Trustee Carryout the express terms Defend the trust Invest the assets Impartial among the beneficiaries
- 12. Choosing A Trustee Mustbe loyal May not delegate the responsibility
- 13. Sample Children moveaway from home and get heavily involved in drug culture Mother changes her Trust to withhold money until they are clean and sober Children challenge Mom’s decision in court Judge rules in favor of Mom. It’s her money. It’s her decision. She protected her children from themselves. Trusts are solid in Courts of Law