Other Types of Personal Trust Planning

Inheritance Trusts
An Inheritance Trust can protect your child from creditors, predators, spouses and estate taxes. Historically most trust based planning left assets to loved ones outright. However, with the increasing divorce rate, increasing amount of litigation, and increasing efforts of attorneys to protect their clients from taxes. The Inheritance Trust is the wave of the future for the sophisticated and the affluent.

If your parents were not aware of this tool to protect the assets you will inherit, with their cooperation you can have one drafted on their behalf.   Inheritance Trusts are one way in which you can create asset protection for assets you will own in a state that does not have Domestic Asset Protection Trust laws.

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Special Needs Trusts
Special Needs Trusts (also known as Support Trusts) and Supplemental Needs Trusts are often a parent’s saving grace. If you have a child who is or will be eligible for needs based government benefits such as Supplemental Security Income (SSI), you know that giving them financial support may do more harm than good. On the other hand you know that your loved one will be living in squalor if the government benefits are all they get. A Special Needs Trust is the answer to taking care of your child without disqualifying them for benefits.

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Life Insurance Trusts
Life Insurance Trusts are one of the most used planning tools of the wealthy. They are most often known as ILITs (Irrevocable Life Insurance Trusts).

Life Insurance is the “Swiss Army Knife” of estate planning. The general public thinks of life insurance as an expense or a liability. However, those who understand insurance think of it as investment vehicle or financial instrument. The following are some uses of life insurance inside of a trust:

a. Leave a legacy to your children
b. Provide cash to your heirs to pay estate taxes
c. Add liquid assets to your estate quickly
d. Replace wealth given to charities
e. Provide for children from prior marriages
 f. Provide funds for business succession
g. Gift money out of your to reduce taxes

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Family Bank Trusts
The Family Bank Trust has many of the same advantages of the Life Insurance Trust but do not require the insurance. They may also be thought of as a spousal retirement trust.

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