When you work on your New York estate plan, you may find that different estate planning tools and options help you accomplish a wide range of goals. While a will is an undeniably important part of any estate plan, there are some things you may want to do that a will does not help facilitate. In some cases, you may find that placing assets into a trust helps you achieve some of your most pertinent estate planning objectives.
According to Kiplinger, trusts are agreements between two parties. The first party is you, the settlor. The second party is the individual you name a trustee. It becomes this party’s job to oversee trust distributions and management and otherwise make sure your wishes with regard to it come to fruition. You may decide to use a trust, rather than a will, to do the following.
Protect public assistance eligibility
If one or more of your beneficiaries collect means-based government benefits, you need to be careful about leaving them assets in a standard will. Those assets may place your beneficiary over the threshold needed to qualify for public assistance programs. Placing assets into a trust helps you get around this because those assets become the technical property of your trustee, rather than your beneficiary.
Prevent heirs from blowing their inheritances
You also have the option of having your trustee make distributions to beneficiaries on a conditional basis. For example, you may decide a spendthrift adult child should only receive a certain amount per year.
Many people choose to make trusts part of their estate plans for these reasons. However, creating trusts may also lead to many other benefits.