September 2023.
Q: Do I need a trust?
A: A trust is a bucket to hold money, for someone – a “beneficiary” – that needs the money but can’t have it in their own name. The classic beneficiary is a young child, someone with special needs, or someone consistently making bad or dangerous life choices such as drug or alcohol use. They need help but can’t or shouldn’t have the money themselves. A trust holds the money and the “trustee” who manages the trust uses the money as you direct. The trust can pay out to the beneficiary at a certain point, such as the attainment of adulthood or a later age, or can hold the funds until the death of the beneficiary and then pay to someone else, such as your other children, or to a charity. You are in control of the terms of the trust; the trustee is in control of the actual administration. A trust can avoid probate, but there are better and less-expensive ways to avoid probate. So, the question is back to you – do you need a trust? Let’s meet, and I can help you understand and decide.
Q: Are there different kinds of trusts?
A: There are many kinds of trusts, used for different purposes. For example, a trust can be set up while you are alive, called a “living trust,” or in your will, called a “testamentary trust.” A trust can hold assets to protect a beneficiary receiving means-tested benefits, called a “supplemental needs” or “special needs” trust, or to provide for a young person, called a “minor’s” or “children’s” trust. A trust can be administered in the sole discretion of the trustee, called a “discretionary trust,” or have very mandatory terms with regard to payout. A “living trust” avoids probate, but a “testamentary trust” does not. The trust you need depends on the needs you have. Let’s meet, and we can explore your options and see how you and your loved ones would be best served.
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Attorney Tim Barkley
The Tim Barkley Law Offices
One Park Avenue
P.O. Box 1136
Mount Airy
Maryland 21771
(301) 829-3778
Wills & Trusts | Estate Planning | Probates & Estates
Elder Law | Real Estate | Business Planning