What Are The 3 Most Common Ways A Trust Can Fail?
A trust can fail in many different ways. But, there are three ways, in particular, that are the most common. By being aware of these reasons, it will be easier for you to work with a trust administration lawyer and to avoid them.
What Are The Benefits Of A Trust?
A trust offers a wide variety of benefits. Some of the most notable benefits that a trust offers are as follows:
- A trust avoids the probate process, allowing your beneficiaries to receive the assets you would like to give them far sooner than they would if your assets needed to go through probate.
- A trust can, if developed properly, protect your assets from taxes that your estate may need to pay off, right before your beneficiaries can receive their assets.
- A trust allows you to specify specific conditions and parameters, regarding the distribution of your assets and who they will go to.
- A trust allows you to assign specific people who can manage your medical care and finances, in the event that you become incapacitated and are unable to do so.
Every single one of these benefits is worth noting. But, every single one of these benefits is contingent on your trust being developed in a certain manner and, if it isn’t, then the trust may fail.
What Are The 3 Most Common Ways A Trust Can Fail?
To ensure that your trust offers the benefits outlined above, while satisfying your needs and goals, there are three common ways a trust can fail that you should be aware of. You can find these three mistakes outlined below.
You Aren’t Clear On The Goals Of Your Trust
Right before you develop a trust, you should take the time to clarify the goals of your trust. Doing so will allow you to develop a trust that satisfies these goals in a manner that is legally sound.
A failure to clarify your goals, and to develop a trust that satisfies these goals, will lead to a trust that fails to satisfy your goals solely due to the fact that these goals are unknown and unclear.
You Never Fund The Trust
A trust must be funded. But, in order for a trust to be funded, assets must often be retitled and renamed, which can be a little tricky.
Even though this process can be a little tricky, it is absolutely essential. A failure to fund the trust will force these assets to go through probate, thereby negating the value of the trust.
You Never Update The Trust
A trust is a living document that must be updated regularly, so that it contains your assets and your wishes. But, if you do not update your trust regularly – or at all – then it won’t contain these assets or these wishes and, as such, they will not be met.
To prevent this from happening, you should update your trust at least once a year. Clarify the assets and wishes you wish to include and, then, update the trust with these assets and wishes.
Speak With A Florida Trust Administration Lawyer Today
You can develop a trust that satisfies all of your goals. But, in order to do so, you must remember the three most common ways a trust can fail and do the opposite of those things.
Speak with a Villages trust administration lawyer at the Millhorn Elder Law Planning Group today and we will assist you in developing a trust that satisfies every single one of your goals.
Sources:
law.cornell.edu/wex/trust
help.flcourts.gov/Other-Resources/Probate
