SecondCor521
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Hi all.
I read over on BH a lot about all sorts of trusts. My general impression is that at a certain point they think you really should have trusts.
They seem to like them to protect against creditors, lawsuits, ill-behaved spouses, and ill-behaved beneficiaries. They like that they bypass probate.
They also imply some estate tax advantages to subsequent generations which I don't quite understand.
They seem to gloss over the setup costs, the additional complexity, the costs of a professional trustee (which BHers also seem to advise often), and the income tax implications associated with trusts (trust tax rates are rather high for income kept in the trust).
There are situations where I think trusts make sense, such as a disabled or very young beneficiary. And possibly in a second marriage situation if the asset levels are quite disparate. And maybe some other complex situations which I don't personally have.
I am single and 52. I have three kids age 26, 21, and 20 who are generally good young adults but are not notorious or especially unusual in any way.
I don't have any trusts set up. My (possibly naive) solutions to the benefits that trusts apparently provide is:
Don't owe creditors (or pay them what you owe)
Try to behave in a way that you don't get sued (not always possible)
Don't marry ill-behaved spouses
Don't be an ill-behaved beneficiary
I live in a state where probate is pretty easy and cheap, and I have beneficiary designations on most of my assets
If you face an estate tax situation, start giving your money away earlier to the next generation and/or charity
My general questions:
1. Am I missing something fundamental or very significant about trusts, especially with respect to their benefits?
2. If you don't have trusts, what would be your trigger points (asset levels or conditions) to start considering them? If you do have trusts, what were your trigger points?
(Yes, I could have asked these at BH. I chose not to because I wanted this crowd's opinions.)
I read over on BH a lot about all sorts of trusts. My general impression is that at a certain point they think you really should have trusts.
They seem to like them to protect against creditors, lawsuits, ill-behaved spouses, and ill-behaved beneficiaries. They like that they bypass probate.
They also imply some estate tax advantages to subsequent generations which I don't quite understand.
They seem to gloss over the setup costs, the additional complexity, the costs of a professional trustee (which BHers also seem to advise often), and the income tax implications associated with trusts (trust tax rates are rather high for income kept in the trust).
There are situations where I think trusts make sense, such as a disabled or very young beneficiary. And possibly in a second marriage situation if the asset levels are quite disparate. And maybe some other complex situations which I don't personally have.
I am single and 52. I have three kids age 26, 21, and 20 who are generally good young adults but are not notorious or especially unusual in any way.
I don't have any trusts set up. My (possibly naive) solutions to the benefits that trusts apparently provide is:
Don't owe creditors (or pay them what you owe)
Try to behave in a way that you don't get sued (not always possible)
Don't marry ill-behaved spouses
Don't be an ill-behaved beneficiary
I live in a state where probate is pretty easy and cheap, and I have beneficiary designations on most of my assets
If you face an estate tax situation, start giving your money away earlier to the next generation and/or charity
My general questions:
1. Am I missing something fundamental or very significant about trusts, especially with respect to their benefits?
2. If you don't have trusts, what would be your trigger points (asset levels or conditions) to start considering them? If you do have trusts, what were your trigger points?
(Yes, I could have asked these at BH. I chose not to because I wanted this crowd's opinions.)