Absolutely, combining a testamentary trust with a living trust is not only possible but often a strategically sound approach to comprehensive estate planning, allowing for flexibility and addressing a wider range of potential future needs and circumstances.
What are the benefits of a living trust?
A living trust, also known as a revocable living trust, allows you to control your assets during your lifetime and distribute them efficiently after your death, avoiding probate—a potentially lengthy and costly court process. Roughly 66% of Americans do not have a will or a trust, leaving their assets subject to the rules of intestacy, and probate which can take years to settle. Establishing a living trust means that assets held within the trust bypass probate, saving time and expenses for your heirs. Furthermore, a living trust allows for continued management of assets if you become incapacitated, designating a successor trustee to step in and manage your affairs. This provides peace of mind knowing your finances will be handled according to your wishes, even if you are unable to do so yourself. The initial setup cost for a living trust typically ranges from $2,000 to $5,000, depending on the complexity of your estate and the attorney’s fees, but the long-term benefits often outweigh the upfront costs.
How does a testamentary trust fit into the picture?
A testamentary trust, in contrast, is created *within* your will and comes into existence only after your death. It’s a powerful tool for situations where you want to provide for beneficiaries with specific needs, such as minor children, individuals with special needs, or those who may not be financially responsible. Imagine a scenario where you want to ensure your child receives funds gradually, say, at ages 25, 30, and 35, to help with education, a down payment on a home, or other major life expenses. A testamentary trust allows you to set those parameters within your will. While a living trust handles asset management during your life, a testamentary trust takes over after your passing, offering a second layer of protection and control. Approximately 20% of wills include testamentary trusts, demonstrating their prevalence in estate planning.
I knew a man named George, who thought he could skip the legal details…
Old George, a retired carpenter, was a proud man who believed in handling things himself. He had a sizable estate, including a beautiful home and several rental properties. He drafted his own will, thinking it would be simple enough. However, he didn’t include a testamentary trust for his granddaughter, Lily, who had special needs. After George passed, his family was left scrambling to establish a special needs trust, navigating complex legal procedures and incurring significant expenses. It took almost two years, a lot of stress, and substantial legal fees to finally ensure Lily’s long-term care was properly funded. If George had consulted with an estate planning attorney, he could have seamlessly integrated a testamentary trust into his plan, avoiding the heartache and financial burden for his family.
Luckily, Mrs. Hawthorne sought guidance and found peace of mind.
Mrs. Hawthorne, a kind woman with three grown children, decided to proactively address her estate planning. She met with Steve Bliss, and they crafted a living trust to manage her assets during her lifetime and a testamentary trust within her will to provide for her grandson, Ethan, who was pursuing a medical degree. The testamentary trust was structured to distribute funds to Ethan over several years, covering his tuition, living expenses, and other educational costs. When Mrs. Hawthorne passed away, the transition was smooth and seamless. Ethan received the funds as outlined in the trust, allowing him to focus on his studies without financial worry. It gave Mrs. Hawthorne immeasurable comfort knowing her grandson’s future was secure, thanks to thoughtful estate planning and a combined trust strategy. It’s estimated that proper estate planning, including trusts, can save families an average of 5-10% of the total estate value in probate costs and taxes.
“Combining a living trust with a testamentary trust allows for a comprehensive estate plan that addresses both your current needs and your future goals.”
In conclusion, combining a testamentary trust with a living trust is a powerful and effective estate planning strategy. It provides flexibility, control, and peace of mind, ensuring your assets are protected and distributed according to your wishes, both during your lifetime and after your passing.
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About Steve Bliss at Escondido Probate Law:
Escondido Probate Law is an experienced probate attorney. The probate process has many steps in in probate proceedings. Beside Probate, estate planning and trust administration is offered at Escondido Probate Law. Our probate attorney will probate the estate. Attorney probate at Escondido Probate Law. A formal probate is required to administer the estate. The probate court may offer an unsupervised probate get a probate attorney. Escondido Probate law will petition to open probate for you. Don’t go through a costly probate call Escondido Probate Attorney Today. Call for estate planning, wills and trusts, probate too. Escondido Probate Law is a great estate lawyer. Affordable Legal Services.
My skills are as follows:
● Probate Law: Efficiently navigate the court process.
● Estate Planning Law: Minimize taxes & distribute assets smoothly.
● Trust Law: Protect your legacy & loved ones with wills & trusts.
● Bankruptcy Law: Knowledgeable guidance helping clients regain financial stability.
● Compassionate & client-focused. We explain things clearly.
● Free consultation.
Services Offered:
- living trust
- revocable living trust
- irrevocable trust
- family trust
- wills and trusts
- wills
- estate planning
Map To Steve Bliss Law in Temecula:
https://maps.app.goo.gl/oKQi5hQwZ26gkzpe9
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Address:
Escondido Probate Law720 N Broadway #107, Escondido, CA 92025
(760)884-4044
Feel free to ask Attorney Steve Bliss about: “Do I need to plan differently if I’m part of a blended family?” Or “What should I do if I’m named in someone’s will?” or “What professionals should I consult when creating a trust? and even: “Can I include back taxes in a bankruptcy filing?” or any other related questions that you may have about his estate planning, probate, and banckruptcy law practice.